Total Credit & Loan Contraction Reaches $1.1 Trillion Since Peak; Volume Down 5.9% From 1 Year Ago

posted by Nima

October 14, 2009 · Posted in General Economics 

Total credit and loan volume in the US is now contracting at a record pace and by record levels, more than at any time since the beginning of the credit crisis, and possibly even more than ever before in US history (source

Total credit and loan volume:


Total credit and loan – annual growth:


This is a rapid and seemingly bottomless contraction at this point. Considering that market behavior and attitudes are currently are currently suggesting the exact opposite, something is bound to blow up right in our faces somewhere and at some point sooner or later. Advertisement: Get your shortlink before someone else does at

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4 Responses to “Total Credit & Loan Contraction Reaches $1.1 Trillion Since Peak; Volume Down 5.9% From 1 Year Ago”

  1. [...] value of unfunded public liabilities has begun to fall, adding in a major way to the current record contraction in credit and loans. Related Posts:Total US Credit and Loans – How Much Contraction Since Peak?Consumer Price [...]

  2. [...] along with an ongoing and accelerating credit contraction, will be forces blowing in the face of all futile attempts to reflate the bubble. Related [...]

  3. Lior Abraham on October 17th, 2009 3:56 am

    isn’t this a good thing? we were hella overextended, which you were against.

  4. Nima on October 17th, 2009 4:21 am

    nothing about this crisis is good. i wish we would have never created it. but within the confines of the crisis, yes it is good to see a contraction and cleanup of debt.

    but the problem right now is that people are acting like it’s all solved and trying to go back to previous spending patterns. meanwhile credit conditions are deteriorating. THAT is what I view as dangerous.

    when perceptions are out of tune with reality, the inevitable correction will hurt even more.

    the bad thing, if you will, is the fact that this contraction is happening only now. we could have let it happen 2 years ago. we could have let all the other necessary corrections and bankruptcies occur then. we would be in our second year of a true rebound, growth, and job creation now.

    but where are we? we are merely on the eve of another dip in economic activity. we will be testing new lows sooner or later. it is this that i criticize, and have been criticizing since the crisis has started, heck i even warned about it way before the crisis started …

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