Economists expected a $15.0 billion rise in consumer credit. The Fed reported -$0.8 billion.
The Bloomberg Econoday consensus outlook “Expected up another strong $15.0 billion in February after rising by $18.1 billion in January.”
January was revised from $18.1 billion to $8.9 billion. That’s a net miss of $25 billion.
Real Consumer Credit in Billions of Dollars
It’s real spending that drives GDP and real credit is rolling over.
Revolving Consumer Credit
In nominal terms, revolving credit peaked in October of 20024 at 1.3689 trillion.
In real terms revolving credit peaked in April of 2008, the fourth month of the Great Recession.
Revolving credit tends to peak just before or in recessions.
How Much Credit Expansion Does It Take to Grow Real GDP?
Please take a look at my April 2 post How Much Credit Expansion Does It Take to Grow Real GDP?
Let’s explore expansion in Total Credit vs expansion in GDP over time.
Hello Jerome Powell, Is Everything Under Control?
On January 31, 2025, I asked Dear Jerome Powell, Is Everything Under Control?
Gold does not believe the Fed has things under control and neither do I.
Three Questions of the Day
- Is the Fed suddenly going to get things under control?
- Will DOGE cut $2 trillion or even $1 trillion in government expenses?
- Is Trump going to magically reduce the deficit via tariffs or any other means?