Economic Notes for the Week of May 14th

Consumer borrowing increased by $21.3 billion for March to $2.54 trillion, which represented the largest monthly increase since November 2001. In addition, the bank loan officer survey showed an increased willingness to lend. Apparently, the feared credit contraction from consumers buckling down and doing some ‘extreme’ saving hasn’t happened, at least on a permanent basis. Despite a lack of confidence and continued economic fears, this isn’t entirely surprising, as it can take a long time to change economic and cultural behavior—assuming a change is what people are after in the first place. Americans are spenders.
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