From David Galland in Casey's Daily Dispatch:

[A] headline that caught my attention [this week] was that “Consumer Credit in US Declined Less than Forecast in October.” This, according to the punditry, was a sign that Americans were feeling economically reinvigorated. So much so that they were willing to pay down even less debt than had been anticipated.

To keep this in perspective, according to Bloomberg, consumer credit peaked at $2.6 trillion in July of 2008. At the end of October, that debt had plummeted to just $2.48 trillion! In October, the decline was particularly sharp, at $3.51 billion.

So, if I have the numbers straight, two years into the worst recession since the Great Depression, consumer debt has fallen by a whopping $120 billion. Against that amount, we have an increase in federal debt closing in on $2 trillion – a clear sign that not only is the government quickly replacing the private sector, but that it is doing so at a rapid rate.

…With consumer debt levels in the U.S. at roughly 95.4% of where they were at the beginning of this debt crisis, anyone who wants to call this game over must be reading from Bernanke’s book… and buying it. Personally, I’m leaving it on the shelf.

Crux Note: Each day in Casey's Daily Dispatch, David Galland brings you an informative and entertaining overview of the markets, the economy, and politics... all from his unique and often contrarian perspective. Casey's Daily Dispatch is absolutely FREE and comes right to your inbox, five times a week. To sign up, click here...

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