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Deteriorating Lending Trends Unrecognized

Published 01/26/2015, 12:40 AM
Updated 07/09/2023, 06:31 AM

A breakdown of total credit at all US commercial banks continues to illustrate significant deterioration in real estate and consumer loans. Real estate and consumer loans account for nearly 45% of commercial bank credit (table). This number rises to 60% when commercial and industrial loans are added.

What happens to these trends during the next cyclical contraction? The public coddled by an endless parade of biased headlines and failed economic theories remains blind to this steady deterioration. Their blindness means those embracing the shallow promises of socialism and poorly educated in the school of observation-based economics will be filing for bankruptcy during the next cyclical contraction. This cycle is approaching faster than most expect.

Table: Total Bank Credit
Total Bank Credit

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