This was seen last Friday on Yahoo, but it’s too good to pass up. Recently compiled statistics show that consumer borrowing, specifically credit card use, increased significantly.
Credit card debt has been surging in recent months as consumers have started borrowing more heavily on their credit cards now that home refinancings have slowed. That slowdown has reflected tighter bank lending conditions as a serious slump in housing has sent home prices falling and increased the level of mortgage defaults.
The Home Equity ATM used by many has been tapped dry now that real estate values are going down and lending standards have tightened, so consumers are turning to the plastic. Good thing for credit cards! They’ll help keep the holiday spending train rolling.
Makes perfect sense to me. More credit usage on credit cards, sure. If you’re going down the bankruptcy trail, you might as well go out with style. What will it hurt if you are losing your home, tapped your 401k trying to save the sinking ship. I’d do it too.