Today the Fed released the latest data on US consumer credit. Once again, student loans represent the dominant component of consumer debt growth (
see post). This debt shows up as "non-revolving credit" owned by the federal government in the Fed's data.
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| Source: Barclays Capital |
Barclays Research: - .. since the start of 2011, total revolving consumer credit outstanding has risen by just $15.9bn while nonrevolving credit has increased by $312.6bn. Nonrevolving consumer credit held by the government, which is comprised of federal student loans, has risen by $266bn over that period, according to our seasonal adjustment process. ... we think that the costs of federal student loan programs are being understated and that they could pose a significant fiscal challenge to the US government in the future.
This is not going to end well.
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