TODAY'S UPDATE

Today's update related to another recent post. This one before the next teardrop.

Dropping from $12.8 trillion to $11.4 trillion, especially if consumer debt is again on the rise, hardly seems like a time for glee, notwithstanding the automatic budget cuts set to spin through the economy. But as a colleague used to always say: "Oh, we'll."

Another point to recall is a rising stock market doesn't mean a strong underlying economy. In fact, if and when the economy clearly starts to do better, the SM could surprise and tank. For more go to Random Reads and see "FHA Hits Brakes........"

Household debt in the U.S. climbed 0.3% in the fourth quarter as student and auto loans rose along with credit-card balances, according to a Federal Reserve Bank of New York survey.

Consumer indebtedness rose by $31 billion to $11.34 trillion, according to a quarterly report on household debt and credit released today by the Fed district bank. Non-housing borrowing increased 1.4% to $2.75 trillion, the third straight quarterly advance.

“The report shows some clear signs of healing in consumer debt markets,” James McAndrews, executive vice president and director of research at the New York Fed, said in the text of prepared remarks delivered today in New York. “While it is too soon to conclude that a trend has been established in which households are beginning to increase their debts again, there are signs that the four-year long contraction is slowing.”

The U.S. economy expanded at a 0.1% annual rate during the fourth quarter, according to revised figures released by the Commerce Department today, as stronger consumer spending and a rebound in residential real estate blunted the impact from cuts in military outlays running at a 22% annual pace.

The “recent improvement” in the housing market has been accompanied by the increase in consumer borrowing, and household delinquency rates are continuing to “slowly recover,” McAndrews said. As of year-end, 8.6% of debt was in “some stage of delinquency,” down from 8.9% in the third quarter, the New York Fed’s survey showed.

http://www.futuresmag.com/2013/02/28/new-york-fed-says-household-debt-climbed-03-in-fou?t=financials