Yesterday's Fed Flow of Funds report revealed that for the first time since the the Fed started to track household borrowing in 1952, household sector debt actually declined between Q2 and Q3 2008, from $13,943.56 to $13,914.22 to be precise. A $29.34 billion decline out of nearly $14 trillion in total household debt may not sound like a big deal, but as the economic data show, without continuous household sector debt growth to fuel its consumer engines the US economy stalls and plummets.


tvsterling at 19:28 2008-12-14 said:
Great analysis as usual. This is going to hurt but there is great promise provided our politicians don't betray us again. First we can get the useless, greedy monster that Wall Street has become tamed & back to it's proper size & business scope. Second we can throw off the yoke of being the world's consumer of first, last & in between resort. That will include actually producing useful things (physical things) instead of strange & wondrous "Financial Instruments". Last we will probably end up being a nation of savers who use credit when needed for important stuff instead of a nation of foolish splurging & partying gluttons. And that's how it should be on all points. Permalink

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