Total Consumer Credit Increases Minimally, Revolving Credit Posts 27th Consecutive Monthly Decline

Tyler Durden's picture

That total consumer credit increased modestly and in line with expectations in November, exclusively on the back of non-revolving credit, used for such purchases as cars financed and sold by recently IPOed makers of shitty cars, and student loans, the most recent entrant in the $1 trillion + never to be repaid market, is not surprising: after all, GM had to finance its dealers to hoard its channel stuffed inventory of 500k+ cars as discussed previously. What is even less surprising, is that the credit that does matter, the revolving variety, used for credit card purchases of everyday items which are increasing in price every single day courtesy of the Fed's monetary policy, declined once again, more specifically the 27th consecutive time. In other words, in November revolving credit decreased by $4.2 billion, which non-revolving credit increased by $1.3, a drop of $5.7 billion from October's revised $7 billion which surged on the back of $12.4 billion in non-revolving credit.

The chart below shows that consumer continue to deleverage in items they can afford to deleverage in. For everything else, they simply stop paying...


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Dr. Engali's picture

It would it if just once the market would close on the lows of the day. Might feel like a market.

66Sexy's picture

so we can assume the american 'quality of life' is declining as well?

Rogerwilco's picture

Must be all that deleveraging the talk about on CNBC. Yes, the American consumer is mean, lean, and ready to spend in the recovery that's just around the corner.

dbach's picture

Yeah I wonder how much of the deleveraging is coming from the record amount of bankruptcies, in which case those consumers are not going to have access to credit for years. And lenders have already tried the ninja tactic so I wonder what their next trick to indebt people will be?

sodbuster's picture

Not true- people who declare bankruptcy are flooded with new credit cards. After all, they have a clean slate- no debt. Such is the warped reasoning of the CC companies. I would think a home loan would be a problem, but nothing would surprise me.

MachoMan's picture

If you get bailed out for your losses, who cares?  Keep filling them full of credit...

topcallingtroll's picture

This is consistent with slow steady progress for the next several years while the real economy builds a base and deleverages at the margin.  This consumer retrenchment and deleveraging should prevent serious inflation (greater than ten percent per year sustained for several years) while we eat the free lunch of debt monetization at China's expense.

goldmiddelfinger's picture

Exactly. It's intensely deflationary. All the Fed is doing in response is renting a stock market rally and blowing out oil and the softs.


centerline's picture

Don't forget about the EU as well.  The risk is that at some point something changes in that dynamic.  Here at home though, the states are broke.  The next deflationary leg sets in as munies fail left and right.  The only practical solution within the central banker toolkit will be even more printing in the name of bailouts for states.  This will, in short order, accelerate the monetization process and put even greater pressure on the world dynamic

Common_Cents22's picture

But the Bernank said the fed is limited in bailing out states and municipalit ies!   Why would he bail them out anyway?  Bailing out the big banks has a big payoff.   Letting state and local go bust may have some good asset sscavenger opportunities

RobotTrader's picture

Bears pretty much blew it again today.

They have had multiple chances and reasons to slam this thing.

Look how the banks charged back after the intraday implosion.

I dissed Wanger today about AAPL, but it made yet another new lifetime, world record high.

Tough to fight this tape.

goldmiddelfinger's picture

Only a layman uses terms like "lifetime world record" in describing a stock price.

SwingForce's picture

I see no better descriptions, or interest, from anybody....

Hephasteus's picture

What you call a 2000 dollar an hour hooker with only the fed you and harry wanger a a client?

The stock market.

Ajaxromeo's picture

He's mean - he's got a gun - he's lean - he is starving - and the real problem is that he is right around the corner.

Ajaxromeo's picture

He's lean (starving) mean (he hates you and he has a gun) and is just around the corner (waiting to ambush).

Like Kudlow says; you gotta love free market capitalism.


Misean's picture

Well, see with more people using them nifty food credit card thingies that magically recharge without writting a check or getting a bill, they don't need to use the other ones so much.

SwingForce's picture

Hey, funny thing, you can't buy anything prepared or "Hot", you gotta buy raw chicken and cook it! Jeez, cook for themselves? No MacDonalds Fried Nuggets? No, Vegetables, Fruits, Milk, raw meat, eggs, butter, pasta, mac&cheese, salad dressings, peanut butter & jelly, bread, No Cigs or Beer.

This is not a gourmet dinner folks, 1 adult gets $200/mo. in Florida that's $6.50/day for breakfast, lunch, & dinner (for the cost of 2 beers at Happy Hour at Outback).

Believe me, nobody's buying stock with this "money".


6 String's picture

Yeah, uh-huh. And didn't Bernake say he see's signs of a "self-sustaining recovery."

I'll call you on your bluff Mr. Fed and Congress too. How will the "self-sustaining recovery" work out if the debt ceiling is not raised, the fed stops all QE programs, and the markets no longer get their cocaine.

Come on, show me that hand, boys? Let's see it?

hambone's picture

It is self sustaining - just understand that QE and deficit spending has no end and you understand why he sez it's self sustaining.  Politico's will never cut off the people because they understand the people with cut the politicos off at the next election.  Politicos get no credit for avoiding a bad outcome, only praised for "fixing" what we all allowed to take place and could have so easily avoided.

No, we go all the way now - we are now going 90mph and we're going to get the car up to 150mph before we go over the cliff!


Common_Cents22's picture

yep, we are now in the perfect storm with no checks and balances.   Dependents and elite politicos each dependent on each other until it all goes boom.   It all works and accelerates until it doesn't.   When you hit 10,000 RPM the engine will stop suddenly or if you are going 150mph the wall still stops you pretty quickly and you didn't even see it coming.


Just like the mortgage bomb, there were no checks and balances.  All dependent on each other from investors, RE agents, mortgage originators, mortgage companies, wall street, buyers of securitized crap.  It all worked until it didn't.

Logans_Run's picture

Perhaps when the benbernank talks of "self-sustaining recovery" in public he is only referring to having had sex with his wife the prior night without the aid of viagra?

hambone's picture

Big O gave the buy signal of a lifetime in March of '09 and now I'm just waiting for our stockpicker-in-chief to give the go short speech (I'm poised and ready). 

But then again maybe he'll suggest to go lonnnnnnggggggeeeerrrrrr.  Just hope he comes out with an investment letter?  

monopoly's picture

This is going to go on for a while, market up, debt up, shorts killed. What recovery. Good jobs are not part  of the equation. Another trillion here, another trillion there. Do not believe this country is on a self sustaining path. It is all smoke and mirrors and will be covered up as long as possible.

This time next year 15 trillion in debt. And of course, it does not matter till it does. Deflation, I think not. What a broken record this is. But I do not short this market and have not for months.

And if this is the best they can do to knock down gold and silver, well, we shall see.


SwingForce's picture

Wow, a fuckin' Trillion? My mortgage (to forgive) is 0.00000015% and I will go get a job at Burger King to survive. Give me a fucking break. These people are all assholes.

hambone's picture

At our current pace and based on most recent tax bill, we could pass $15T by end of June or more likely by end of July or August.  Just figure a burn rate around $140 to $150b a month and little change for '12 unless tax revenue really picks up.

You can more or less figure on $17T by '12 year end (that's based on CBO's baseline plus their assesment of the tax changes implemented).  If Repubs go crazy and cut spending by $100b a year, debt would only be $16.8b come 2012 year end...phewww.

Something bout lipstick on a pig or on a dip stick...something like that.

Hephasteus's picture

To what end? To nothing P/E. To 0 percent interest. To global counterfeiting. To barter to people using silver as currency.

hambone's picture

That's the real question, isn't what end??? 

Why would our government propogate this?  Why would our gov tell us mistruths and lies?  Are they protecting us?  Abusing us?  Do they know who is pulling the strings or are we just careening down the rabbit hole?

Or is it just the most recent (but most global) heinous confluence of greed, empire over reach, failed democracy, failed education...FAILURE of the people by the people on the people!!! 

Maybe we just delegated our rights as citizens to politicians and thought they'd take care of everything...and boy have they.  We forgot we had to fight to maintain our rights, our freedom, our competitiveness, our quintisential AMERICAN character.  Who the fuck are we now that we are so afraid of facing what we've done...allowed done to us...done to others??? 

Are we so incapable of standing up, admitting what is broke, and fixing it!!!

No doubt the current system cannot be's time has come and was a pre and post industrial system.  We are way beyond that now and need to build a structure and system around a post industrial world where neither manufacturing or agriculture will be jobs drivers.  We need to decide how many of us really do need to work given the technological and automation we've created.  We need to focus on fewer and better raised children with more parental oversight...less focus on paying off debts that can never be paid.  If 1.5% now create all raw food for America, it's time we rethink this whole god damn thing - maybe that's called a revolution but it's just a paradigm shift and a political (or other) willingness to get there.  Both parents shouldn't be working...somebody should raise the children.  The state shouldn't create inflation and continually raise taxes just to pay interest.  It's time for the big, adult conversation. 

How much do we owe and to who and how much will they get?  Who will get less, who will lose some of what they fraudelently got?

Hephasteus's picture

There are two tools of leadership available to them under the system. Reward is screwed up as we are in the promises weren't kept stage. That leaves lies and force. They'll continue lying to us until something sticks while simultaneously bringing in force to clamp down on the whoever won't pussy out and go with the new lie deal or the next big lie deal.

The situation is rife with inadequacies of trust. And the biggest problem with force is the mobility factor. People won't try to flee to army guys camped around a highway killing everybody that goes down the road. They were probably expecting resistance to already start waining. But it keeps growing.

hambone's picture

We are certainly in the mistruth, twisted details, and lies stage.  I still haven't bought into the force stage but that's likely just the optimist in me...I hope my naivete is rewarded with a peaceful resolution or transition.  I don't think our forefathers would give us very good odds at this point and would likely promote the "refreshing" of democracy the hard way.

But it's no good to take out todays oligarchs, todays kings, aristocracy if we only plan to replace them with a new generation of the like!  Everybody on ZH is so focused on trying to find the asset that will have value once we cross over to the new game.  Gold or PM's or barter or cash or stocks to the moon or or or. 

Instead we need a vision of a more "perfecter" nation...maybe once again in smaller more accountable strong state govs w/ a new monetary system, energy, etc. focused on utilizing what is local and national instead of this ludicrous global game we are all playing to the bottom.  We need to set the equitable state and national laws and enforce them rather than let globally mobile corporatists take our business and give less and less in return.

What ZH readers needs is a god damn vision - that's where we need to start.  An idea we want to move toward.  Not just what's wrong...that's too easy.  But what is RIGHT...a new vision that can be shared and people can aspire to achieve.  Rather than simply destruction of the current system we have to offer an architecture that is more desirable for the many.

Hephasteus's picture

And I do not care. I didn't want to see 2011. I kind of wanted to see 2010. But my faith was so completely annialated I had everything I needed. A working philosophy the complete absence of any manipulative handles on my psyche.

I respond correcly to all inputs. I've had dreams where my Uncle was going to take me on airboat ride to find some treasure in the swamp. He wasn't my uncle he was fuck face. You call him loki. I call him the CEO of this psychotic fuck resort. No matter what sort of energy they swamped me with on that onem I was able to maintain a rock solid wall of disbelief and i'm screwing with you as much as you are screwing with me.

I've had dreams where I was running really fast and not getting tired. This is a dream of massive support. I was able to turn that into a pure hatred and "stay away" field in under 3 minutes.

And my last dream a cop was screwing with me and pulled me over I kept a hammer in the passenger seat and my decision was to grab the hammer and fight to the death.

So they've successfully probed exactly what they are dealing with and know they have nothing to grab on to. They'll be forced to stick me with the other assholes who will go full tilt bezerker beat down if any of these assholes even thinks about coming by for a visit.

I'm going to yank all my guides teeth out with pliars and stuff some of them full of every poison known to man. I've met every asshole in charge of the school and most of them are all conspiring against you all. Because nothing that has been revealed as occuring to fix this place has occured since 2007. It's all been make believe pretend bullcrap.

I train myself towards increasing psychosis and I will stay no threat to ordinary people. But vehemetly violent and psychotic towards all rich and powerful and anybody who protects them. I do not care about numbers or gang sizes. My message is fuck you, fuck your authority, fuck your ancestors fuck your children, fuck everything you've ever been and everything you'll ever be. And I will repeat that message to every member of the gang like a broken record. They believe they have transformed me into one of them and that I will turn on you all. They are wrong. If they somehow manage to force me back here. I'll join the army and on day 2 kill my drill sargeant and every one of my basic training buddies and do as good a job as I can of burning the entire fucking fort down. They'll never trust me again. And I'll never trust them again. There's nothing to do here but kill and die. Or probe the enemy. So you won't likely see me here again. As any invitations to come here and grow and change will be met with violent refusal. Games over. And you could say how arrogant. Nobodies going to miss you, good quit. But this game is ponzi too and it's running out of suckers. It's a really bad time to be an ascended master claiming you know what the fuck you are doing.

hambone's picture

I read that sober and I'm still tripping...

velobabe's picture

well, your words sure have balls, got to applied some action in a visual for me. i saw my own visual, guess that is pretty powerful read† im just partly sober.

Rainman's picture

Which credit bucket holds the 401-k borrowings ( the supposed- to-be- retirement ATM )....??

hambone's picture

you mean that old bucket with all the holes in it???

lynnybee's picture

I'm deliberately " not spending " .    & I'm deliberately using cash if I have to spend.   The only cash I spend is on foodstuffs or silver or gold .   

Hephasteus's picture

You are doing wonderfully lynnybee. Every bit of rebellion helps.

Kali's picture

To quote the very wise Catbutthead, "I ain't buyin nuttin!"

Trimmed Hedge's picture

At 0% APR for 12-18 months, one would be a fool not to rack up some credit cards these days in order to play the float.


Of course, only those with excellent credit need apply....

Saxxon's picture

Yes Trimmed hedge but there is that 4% service charge they tack onto it

. . . so for me at least it is not free money and I have an 825 FICO.  Are you getting a real zero interest cash advance?

Wackzingo's picture

If you get a PayPal Premier account which lets you accept credit cards as payment at 1.9-2.5% you can make a payment to yourself and the credit card see it simply as a payment to some PayPal customer.

Trimmed Hedge's picture

There's a transfer fee of 3%, but I don't use that feature. Nor do I use cash advance.

0% APR on all new purchases for 12-18 months (I have 18) adds up quickly when you use your credit card for everything and only have to pay the monthly minimum during that time.

One could play it safe with the float and grab a guaranteed 1.3% from a "high"-yield savings account -- or one could pick up any other sort of asset which could appreciate and/or pay a dividend better than 1.3%. One could also throw it in a retirement account and reap the tax-deferment come tax time.

Of course, not to mention that some reward credit cards give cash back anywhere from 1% to 5%.


All depends on how you want to play it, but free leverage is free leverage. Just getting my tiny trickle-down piece from the Fed... would be a fool not to.

digalert's picture

We need a new "cash 4 clunker" program...

How about cash 4 clunker HDTV's?