Consumer Credit Jumps The Most Since Free Money Covid Stimulus Checks

Consumers pulled out their credit cards in December fueling a surge in consumer Credit.Consumer credit data from the Fed, chart by Mish. Change in Consumer Credit

Total: $40.85 Billion

Revolving: $22.86 Billion

Nonrevolving: $17.99 Billion

Nonrevolving Excluding Government: $15.30 Billion

Government debt is the student debt program. Consumer Credit in Billions of Dollars(Click on image to enlarge) Consumer Credit Totals

Total: 5.146 trillion

Nonrevolving: 3.763 trillion

Nonrevolving Excluding Government: $2.244 trillion

Nonrevolving Government: $1.519 trillion

Revolving: $1.382 trillion

Real (Inflation-Adjusted) Consumer Credit(Click on image to enlarge)Real Consumer Credit Totals

Total: $4.126 trillion

Nonrevolving: 3.018 trillion

Nonrevolving Excluding Government: $1.800 trillion

Revolving: $1.108 trillion

The winners are those with mortgages who refinanced when mortgage rates fell to 3.0 percent. Inflation ate away much or their debt.The same is not true for those in the student loan or credit card traps at interest rates that have been generally higher than inflation. Revolving Consumer Credit in Billions of Dollars(Click on image to enlarge)On an inflation-adjusted basis revolving credit does not look so bad. But it’s a disaster for those who carry a balance are are paying interest rates in excess of 20 percent.The nominal monthly increase of 22.86 billion in revolving credit was higher than the consensus estimate of $16.00 billion for total credit.This was a stunning number that is sure to put some people in debt trouble or greater debt trouble for those already there.December Had the Second Largest Monthly Trade Deficit in HistoryOn February 6, I noted For those wondering what happened, the surge in consumer credit explains some of it.The rest is importers scrambling to beat Trump tariffs.