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Politics : Sioux Nation -- Ignore unavailable to you. Want to Upgrade?

To: Ron who wrote (159874)	2/6/2009 11:26:19 AM
From: T L Comiskey	Read Replies (1) \| Respond to of 361950

Laura's still married to this guy right..?? (Or did Jeff Gannon finally win out.) politicalhumor.about.com

To: Ron who wrote (159874)	2/6/2009 4:37:48 PM
From: stockman_scott	Respond to of 361950

U.S. Consumer Credit Falls Fourth Time in Five Months (Update3) By Vincent Del Giudice Feb. 6 (Bloomberg) -- The pace of borrowing by U.S. consumers fell in December for the fourth time in five months as the deepening recession and restrictions on bank lending crimped purchases. Consumer credit fell by $6.6 billion, or 3.1 percent at an annual rate, to $2.56 trillion, according to a Federal Reserve report released today in Washington. In November, credit decreased by $11 billion, more than previously estimated and the biggest drop since records began in 1943. Borrowing may shrink further with banks continuing to make it harder to get loans as they grapple with mounting losses and writedowns. Demand for credit is also sliding after consumer spending, which accounts for about 70 percent of the economy, posted a record six months of declines. “The situation is ugly and will only get uglier,” said Richard Yamarone, director of economic research at Argus Research Corp. in New York. “Businesses are slashing jobs at an accelerated pace, and consumers are retrenching just as fast. The economy is in a freefall, and the severe contraction in credit underscores the crisis.” Before today’s release, economists forecast consumer credit would drop $3.5 billion in December, according to the median of 30 estimates in a Bloomberg News survey. The Fed initially reported a $7.9 billion decrease in consumer borrowing in November. Revolving Debt Revolving debt, such as credit cards, decreased by $6.3 billion in December, according to the Fed’s statistics. Non- revolving debt, including auto loans and mobile home loans, fell by $288 million. The report doesn’t cover borrowing secured by real estate. “Consumers have hunkered down, sharply reducing their spending and, consequently, sharply slowing their use of credit,” said Steven Wood, president of Insight Economics LLC in Danville, California. “Consumers are deleveraging along with the rest of the economy. This does not bode well for real consumer spending in the months ahead.” For all of last year, consumer spending registered its smallest increase since 1961. Purchases are likely to keep falling at the start of this year as jobless rolls climb. The unemployment rate reached the highest level since 1992 and payrolls tumbled in January. Millions more may lose their jobs before a stimulus and emergency-lending programs temper the U.S. economy’s freefall. Record declines in home values have also shaken confidence in the economy. Jobless Rate The jobless rate rose to 7.6 percent from 7.2 percent in December, the Labor Department said today in Washington. Payrolls fell by 598,000, the biggest monthly decline since December 1974. Losses spanned almost all industries, from construction and manufacturing to retailing, trucking, media and finance. Underscoring the depth of the credit crisis, a majority of banks imposed tougher standards on consumers and businesses to qualify for loans in the past three months, according to a Fed report released Feb. 2, even after institutions received more than $200 billion of taxpayer funds. The financial system has incurred more than $1 trillion of losses and writedowns in the financial crisis sparked by a collapse in housing. Charge-offs, which occur when issuers give up trying to collect payments on delinquent accounts, on retail credit cards reached a three-year high in December as late payments rose, according to Fitch Ratings. Charge-offs climbed to 10.5 percent last month, 49 percent higher than a year earlier, Fitch said in a report issued on Jan. 7. Fitch estimates that the rate may surpass 12 percent in the first half of this year. American Express American Express Co., the biggest U.S. credit-card company by purchases, said Jan. 26 that its fourth-quarter profit dropped 72 percent from a year earlier as more customers fell behind on loan payments. Credit card lender Discover Financial Services announced on Jan. 29 that failed customer loans will probably rise to more than 7 percent this year. Auto sales plunged 36 percent in December, dragging the industry’s volume in 2008 to a 16-year low, and General Motors Corp.’s annual total was the smallest in its home market since 1959. What’s more, Toyota Motor Corp. and Honda Motor Co. reported their first drop in full-year U.S. sales since the mid-1990s after December declines of at least 35 percent. To contact the reporter on this story: Vincent Del Giudice in Washington vdelgiudice@bloomberg.net Last Updated: February 6, 2009 16:15 EST