• 09 Nov 2009 at 3:36 PM

Recovery Even Slower Than Thought Earlier Today

The most oft-heard description of the current economic recovery is “slow.” (Nonexistent is a distant second.) And hot on the heels of another disappointing jobs report, which put unemployment about 10% for the first time in 26 years, here’s some more evidence that the economy may eventually recover fully at some point in the next decade.
The Fed went around and talked to a bunch of banks, and found that only some of them are still tightening credit standards. Which I guess means that the credit crisis is only getting slightly worse more than two years on.
To its credit, the Fed didn’t exactly try to sugarcoat the news that only 15% of lenders–be they commercial, industrial or credit-card–were making it tougher to get their money. The central bank said the “tight credit” market is keeping the economy down, and is likely to do so for an “extended period.”


Banks may have, for the most part, stopped tightening their loan terms, but, with the exception of prime residential mortgage-seekers, there don’t seem to be all that many takers for the loans that they are offering. Demand for loans continued to weaken at banks, albeit at a smaller number.
The Fed is trying to get to the bottom of this conundrum: Asking a special question in the October Senior Loan Officer Opinion Survey, Ben’s boys learned that banks are originating fewer commercial and industrial loans, and that those who have them aren’t using their revolving credit lines that much. Meanwhile, those loans outstanding are getting a little long in the tooth: About three-quarters of banks told the Fed they had extended more than one-quarter of construction and development loans set to mature in September.
So this holiday season, spend, Streeters, spend. Nobody else will be.
Fed Says Fewer Banks Tightened Lending Standards in 3rd Quarter [Bloomberg]

19 comments (hidden to protect delicate sensibilities)
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Comments (19)

  1. Posted by guest | November 9, 2009 at 3:43 PM

    too DealBook, didn’t need

  2. Posted by guest | November 9, 2009 at 3:48 PM

    Shazanus,
    You are finally starting to make up for your horrible start with dealbreaker. stay solid. you douche bag

  3. Posted by guest | November 9, 2009 at 3:48 PM

    Shazanus,
    You are finally starting to make up for your horrible start with dealbreaker. stay solid. you douche bag

  4. Posted by guest | November 9, 2009 at 3:54 PM

    Shazar-
    You are way better than Greg and it is only your second week. Keep it up.
    -J. Carney

  5. Posted by guest | November 9, 2009 at 3:56 PM

    I am going to do my part by tipping the 8 people responsible for building and maintaining my gold-plated scrot.
    -LB

  6. Posted by guest | November 9, 2009 at 4:01 PM

    That post was toight like mans anus!
    -Borat

  7. Posted by guest | November 9, 2009 at 4:03 PM

    @5 – You left that comment last week.

  8. Posted by pfluger | November 9, 2009 at 4:07 PM

    Pssst: The future is plastics.

  9. Posted by guest | November 9, 2009 at 4:11 PM

    There was also a survey last week by Dow Jones showing that all the Primary Dealers see Fed hikes in 2010. RBS, at 3%, was the most hawkish.

  10. Posted by CoveredLong | November 9, 2009 at 4:46 PM

    @8 – The wave of the future, the wave of the future, the wave of the future…
    -HH

  11. Posted by Tax Chick | November 9, 2009 at 5:19 PM

    @Covered
    Did you just tip your hand that you are in fact the HeadlessHorseman?

  12. Posted by guest | November 9, 2009 at 5:51 PM

    TC – I politely suggest he was mocking the HorselessHeadman.

  13. Posted by CoveredLong | November 9, 2009 at 5:56 PM

    @11/12 – Botched Howard Hughes line from the Aviator…should read ‘way of the future’. Nothing to do with HeadlessHorseman, pfluger’s comment just made me think of that line for some reason.

  14. Posted by Tax Chick | November 9, 2009 at 6:01 PM

    @Covered
    Quite relieved. I was going to suggest medication for the split personality disorder since your tone and his is diametrically opposed.
    @12 – That thought crossed my mind as well, but I couldn’t see it (the mockery that is).

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