Consumers exhibited their increased confidence in the economic rebound by borrowing more money in August than in three months.
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The largest gains were in car loans, student loans, and credit card debt. The report, along with drop in the unemployment rate reported on Friday, October 5, is viewed as a positive sign for the recovery.
Retail sales rose in August based in part on increased car and truck purchases. Caution still ruled in other areas since gas prices have risen.
Consumers borrowed $4.2 billion more on their credit cards and $13.9 billion more in automobile and student loans.
The increase in student loans is being tied to the still high unemployment rate. But overall, the financial picture for most Americans has improved. The Fed issued a separate quarterly report showing that strength in the housing market and the rising stock market were helping Americans recover the losses
they experienced in the 2008 financial crisis.
If the decrease in the unemployment rate holds over the next few months, one of the most concerning areas of the economic recovery will join the improvement in the housing market.
That will strengthen consumer confidence even more and, perhaps, begin to give the recovery the momentum it needs.