Consumer lending has slowed to a crawl, though not in all categories, and lending on the whole has actually held up fairly well.
Whereas consumer loans increased $65 billion, or 8.7%, in the year ended Jan. 9, consumer loans since that time have increased just $300 million. This is according to the Federal Reserve's most recent weekly report on the assets and liabilities of the nation's commercial banks, which was released late Friday. These figures do not include real estate loans or home equity loans, which have faired better.
For example, real estate loans have increased at a 4.6% pace since Jan. 9, although that pace is slower than the 6.2% pace of the previous year. Home equity
loans have actually accelerated, increasing at a 13.3% pace since Jan. 9, an increase of several-fold over the previous year.
For bank lending on the whole, loans and leases in bank credit, a category that includes commercial and industrial loans, real estate loans, consumer loans, home equity loans and loans to securities firms via reverse-repurchase agreements, has increased at a 12.9% pace since the end of July, an acceleration from the 9.8% of the previous 12 months.
Tony Crescenzi Blog Rate-Cut Odds Are Up, but Subdued 3/31/2008 11:40 AM EDT The market is pricing in more cuts, but not overwhelmingly.
Tony Crescenzi Blog Chicago Shows Downturn Shallow 3/31/2008 10:30 AM EDT While the news was mostly positive, there are some negatives that stick out.
Tony Crescenzi Blog $44 Billion of Fresh Cash 3/31/2008 9:29 AM EDT Bank deposits grow, providing banks with a stable source of capital.
Tony Crescenzi is the chief bond market strategist at Miller Tabak + Co., LLC, and advises many of the nation's top institutional investors on issues related to the bond market, the economy and other macro-related issues. At the request of the Federal Reserve, Crescenzi is a regular participant in the board's Livingston Survey of economic forecasters. He is also the author of the revised investment classic, The Money Market,
first published in 1978 by Marcia Stigum, and The Strategic Bond Investor. At the time of publication, Crescenzi or Miller Tabak had no positions in the securities mentioned in this column, although holdings can change at any time. Under no circumstances does the information in this column represent a recommendation to buy or sell stocks. Crescenzi also is the founder of Bondtalk.com, a popular Web site covering the bond market and the economy. Crescenzi appreciates your feedback; click here to send him an email.
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