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Strategies & Market Trends : The Epic American Credit and Bond Bubble Laboratory

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To: austrieconomist who wrote (28440)	3/11/2005 6:13:17 PM
From: russwinter	Read Replies (1) of 110194

When looking over the Fed H8 one can see a real sea change going on in bank deposits and consumer type lending. Since we are a bloated credit expansion based economy, there needs to be lots of too, otherwise all the malls and strips quickly empty out. Overall bank credit is misleading right now, because it seems to be funneled into speculative and real estate activity. But when you break it down, and look at overall bank deposits, they are barely growing. YTD is only up $4.25 billion a week, compared to $11 billion a week in 04. Look at combined home equity and consumer loans. Last year that ran about $3.4 billion / week. YTD it's only $1.3 billion, with consumer loans absolutely flat. There may be a little lingering juice from refis, as that been over 2000 the last six weeks, but this latest rate spike should knock that down too. I've already commented on the effect on month in month out ARMS resets now. And gasoline. For my money I just don't see how you can have an expanding Bubble based economy with this happening. Unless they can get rates back down 50 bps, the retreat is underway. federalreserve.gov

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