Bernanke: "Recession Is Over" (Depression Has Just Begun)

Then explain this for credit card charge-offs for the last month:

Discover Financial Services Reports Aug Master Trust; Net Charge offs 9.16% v 8.43% m/m

JPMorgan Chase and Co Reports Aug Master Trust; Net charge offs 10.07% v 7.92% m/m

Bank of America Corp Reports Aug Master Trust; Net Charge offs 14.54% v 13.82% m/m

Citigroup Inc Reports Aug Master Trust; Net Charge offs 12.1% v 10.03% m/m

American Express Co Reports Aug Master Trust: Net write offs on managed basis 9.0% v 9.2% m/m (v 9.9% in June)

So out of these, only Amex reported a (tiny) improvement. Everyone else is worse - a lot worse.

As for Bair? Here's what she said:

FDIC's Bair: US financial industry is not much more stable presently,

I'd say its not much more stable when you've got a charge-off rate on revolving credit beyond 10% - and climbing!

Anyone care to dispute "the consumer has no more credit availability" with me again?

Again, I come back to the same point: Credit is contracting as a consequence of borrowing ABILITY, not (so much) desire. All the "liquidity pumping" in the world does NOTHING if there are no willing and able borrowers.

The entire premise of both government and our central bank is that "credit is too tight." In point of fact what we continue to see proof of month after month is that credit has been and still is too loose as borrowers are unable to pay back the money lent, which in turn leads to more and more onerous terms for those who still have money out.

That's deflationary as hell and the longer the game of "pretend" is played the more deflationary it is and the more damage is done to the underlying structure of the economy, as the money blown to "prop up the fable" simply disappears into a puff of smoke but the debt is left behind and continues to be a drag on economic activity.

Bernanke's gambit has failed - ...
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