News headlines are always about the economy growing, and
consumers soon forget history. It's interesting that although our economy is
"growing", businesses have slowed on borrowing from banks.
The rate of 12-month loan growth at U.S. banks in the third
quarter hit its lowest level since the end of 2013, according to data released
last week by the Federal Deposit Insurance Corp. That marked the sixth
consecutive quarter of decline for this measure of loan growth.
This behavior is interesting, in spite of the continued low
long-term interest rates and what was supposed to be a banner year for
financial institutions following last November's elections, tax reform, and
lighter regulations.
It's interesting how the media sees low borrowing as a
concern, and how dependent upon growing debt our economy has become. You need
to read between the lines on what it actually means for businesses to
be borrowing less (obviously the banks want us to borrow more) - does this mean
that businesses are financially stronger and more responsible? Did businesses
learn from their mistakes following the last recession? Are banks tightening
their criteria?
Stay Educated and
Best To Your Real Estate Investing,
Wilson Investment Properties
408-867-1867
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