Is the consumer drop in debt due to tightening of belts (as suggested in the article) or is it a reflection of Banks writing off credit card defaults?
Credit cards dropping balances as people continue to work on paying off revolving debt By Reuben Rosenberg – credit.com
According to the Federal Reserve Board, revolving consumer credit fell at an annual rate of 11.7 percent during December. Overall, revolving credit – which is mostly credit card debt – declined from $874.5 billion in November to $866 billion in the last month of the year.
The drop in revolving consumer credit may come as a surprise to some, especially since the numbers reflected the time of the holiday shopping season, where people may bust out their credit cards to make purchases. Along with the decline in December, November saw an 18.6 percent drop in revolving consumer credit. http://www.credit.com.
