Sorry!! The article you are trying to read is not available now.
Thank you very much;
you're only a step away from
downloading your reports.

Two Ways To Play: Biggest Consumer Credit Drop Ever


Strengthen your portfolio in good times and bad.

The Federal Reserve said today that consumer credit dropped by $7.9 billion to $2.58 trillion. According to Bloomberg, it was the first drop in more than a decade and also the biggest since 1943, when statistics began.

Total borrowing by consumers dropped at a 4.3% annual rate in August. That was the most since January 1998, during the Asian Financial crisis. Revolving debt like credit cards fell by $612 million during the period and non revolving debt, including auto loans, plunged by $7.3 billion.

Economists were looking for an increase of $5 billion in consumer credit in August. In July, credit rose by $5.2 billion, revised upwards from a previous report of a $4.6 billion gain.

For more context on the economy, see today's Five Things You Need To Know by Professor Kevin Depew.

From the Bull Pen: The data certainly isn't very uplifting. But bulls can still look to MasterCard (MA) for an upside trade. There are signs that the selling in this stock may be overdone. Sell stops can be considered around $150.

From the Bear Cave: Bears need to constantly be on the lookout for a sharp countertrend rally. Thus, Target (TGT) in the $45-50 range could be an interesting downside candidate.
< Previous
  • 1
Next >
No positions in stocks mentioned.

The information on this website solely reflects the analysis of or opinion about the performance of securities and financial markets by the writers whose articles appear on the site. The views expressed by the writers are not necessarily the views of Minyanville Media, Inc. or members of its management. Nothing contained on the website is intended to constitute a recommendation or advice addressed to an individual investor or category of investors to purchase, sell or hold any security, or to take any action with respect to the prospective movement of the securities markets or to solicit the purchase or sale of any security. Any investment decisions must be made by the reader either individually or in consultation with his or her investment professional. Minyanville writers and staff may trade or hold positions in securities that are discussed in articles appearing on the website. Writers of articles are required to disclose whether they have a position in any stock or fund discussed in an article, but are not permitted to disclose the size or direction of the position. Nothing on this website is intended to solicit business of any kind for a writer's business or fund. Minyanville management and staff as well as contributing writers will not respond to emails or other communications requesting investment advice.

Copyright 2011 Minyanville Media, Inc. All Rights Reserved.

Featured Videos