The September consumer credit print is out and once again, it shows just what the key drivers in the US economy are. Or rather is: it is the US government handing out unrepayable student and car loans, even as the general consumer is widely deleveraging. Looking at the numbers: of the $13.7 billion in total consumer credit created in September, $15.8 billion (no, it’s not a typo) was non-revolving credit, i.e., auto and student loans. The remainder, or ($2 ) billion, was yet another month of credit card deleveraging, as the bulk Americans can only buy “stuff” if it comes with the implicit provision that the credit will never have to be repaid, such as when it comes from the most insolvent entity of all – Uncle Sam.
But perhaps the chart that puts it all in perspective, is the following, which shows the breakdown of total credit issued in the past year broken down between revolving (credit cards) and non-revolving (car and student loans). The latter amounts for 99% of all loans taken out in the past 12 months. It needs no additional commentary.
Thank you Uncle Sam for making yet another generation of indentured servants who are studying geology on the taxpayers’ dime, who will never get a job, who are up to their neck in debt, but at least can afford a Chevy Silverado.
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via Zero Hedge http://feedproxy.google.com/~r/zerohedge/feed/~3/CaqZEVFv95I/story01.htm Tyler Durden