Consumer credit pulled back for the seventh straight month in August, led by a steep decline in credit card usage, a government report said Wednesday, as unemployment soared and cash-strapped consumers continued to limit spending. The total amount of credit outstanding fell by $12 billion, or a 5.8% annual rate, to $2.463 trillion in August, according to the Federal Reserve. "Credit is being squeezed on both sides," said economist Sean Maher of Moody's Economy.com, adding that lending standards at banks remain tight and consumers are pulling back on their debt. "I was a little surprised that nonrevolving balances didn't increase slightly due to the surge of vehicle sales driven by the Cash for Clunkers program," said Maher, who expects the rise to show up in September's report. While declining consumer credit delays economic recovery in the near term, Maher said it's ultimately a positive development because consumer debt levels were too high and the savings rate was too low. John Penrose, the Shadow Consumer Minister, said: "These announcements do not go far enough to address the culture of problem debt and do not seek to change consumer behaviour or encourage more responsible borrowing."
Californians losing their homes face big tax bills unless Schwarzenegger, lawmakers compromise What should have been a legislative afterthought is threatening to become a financial purgatory for thousands of California taxpayers hit by the housing crisis. With less than a month until ...
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MMI offers tips for understanding the CARD Act While only 10 percent of respondents in a recent Money Management International (MMI) survey believe students should use credit cards to finance college costs, many students get their first credit card while they are ...
New court data show surge in cases related to consumer issues in fiscal 2009 The number of new cases in federal courts related to consumer issues surged in the year ended last Sept. 30 as Americans battered by the recession fought foreclosures ...
Fed holds rates at record lows to foster recovery; view of economy slightly more upbeat The Federal Reserve on Tuesday repeated its pledge to hold interest rates at record lows to foster the economic recovery and ease high unemployment. But the Fed's ...
How Boomers can turn around the reversals of fortune in time for retirement Economists say that, technically, the recession is over and the economy is starting to move again. But for millions of Baby Boomers, the pain is still with us, including ...
Paul Goulet hopes Connecticut will help him get from under nearly $8,000 he's borrowed for college after losing his job in a paper manufacturing plant. Goulet, 55, is a student in environmental studies at Goodwin College in East Hartford, aiming to find ...
Health care plan could also help resurrect college aid plan Congressional Democrats want a stalled overhaul of college aid programs to get strapped onto a fast-track health care bill, giving both Obama administration priorities a better chance of passage. The student loan ...
WASHINGTON (Reuters) - President Barack Obama's stalled bid to overhaul the federal student loan program by cutting subsidies to private lenders and increasing aid to students received a boost on Friday. Democratic congressional leaders agreed to fold Obama's student-loan proposal into a ...
PALM BEACH, FL - FEBRUARY 25: Karen Herrera works with a Bank of America negotiator as she tries to restructure her mortgage loan during a "Save the Dream" tour stop by the Neighborhood Assistance Corporation of America at the Palm Beach Convention ...
