Consumers Cutting Back

U.S. consumers are cutting back on borrowing like never before, according to the Federal Reserve.With banks and card issuers cutting credit, and with unemployment rising, housing prices still falling, and generally poor economic news, consumers are hesitant to borrow. Credit card balances, auto loans and other forms of consumer credit fell by by $21.6 billion in July, the biggest decline on record.
That's equivalent to an annual decline of 10.4 percent, the Federal Reserve said. It's the sixth consecutive month the measure of consumer credit has contracted. In June, it fell by a revised 7.5 percent.Both Visa and MasterCard say the proportion of debit transactions on their networks is growing. At Visa, the world's largest payment network, they've surpassed credit card purchases.Revolving credit, comprising mostly credit card balances, fell eight percent in July. Meanwhile, non-revolving credit fell 11.7 percent