Consumers borrowed more for 8th month in May

[xchrom]

http://hosted.ap.org/dynamic/stories/U/US_CONSUMER_CREDIT?SITE=AP&SECTION=HOME&TEMPLATE=DEFAULT&CTIME=2011-07-08-15-26-23

WASHINGTON (AP) -- Americans took on more debt in May and used their credit cards more for only the second time in nearly three years, stepping up borrowing just as the economy began to slump and hiring slowed.

The Federal Reserve said Friday that consumer borrowing rose $5.1 billion in April. That following a revised gain of $5.7 billion in April. Borrowing in the category that covers credit cards increased, as did borrowing in the category for auto and student loans.

The overall increase pushed consumer borrowing to a seasonally adjusted annual level of $2.43 trillion in May. That was just 1.7 percent higher than the nearly four-year low of $2.39 trillion hit in September.

Borrowing is a sign of confidence in the economy. Consumers tend to take on more debt when they feel wealthier. That boosts consumer spending. Ultimately, it gives businesses more faith to expand and hire.

[Skink]

1. issuing more cards. Raising limits.

ramping up the derivatives and credit default swaps. crash should occur right before the 2012 election.

[ixion]

2. and here's the thing: Americans can't simply 'raise their debt ceiling'

it's predefined for us by the same companies that rip us off daily. Once that ceiling is reached and/or breached, it's all over.


The ONLY thing holding things together right now is people charging gas and food and utilities to their credit cards. Once the credit cards are maxed, that's when it starts to get interesting.