Consumers borrowed more for 8th month in May

[WestVirginiaRebel]

Yahoo News:

WASHINGTON (AP) -- Americans took on more debt in May and used their credit cards more for only the second time in nearly three years. Consumers stepped up their borrowing just as the economy began to slump and hiring slowed.

The Federal Reserve said Friday that consumer borrowing rose $5.1 billion in May, the eighth straight monthly increase. It followed a revised gain of $5.7 billion in April. Borrowing in the category that covers credit cards increased, as did borrowing in the category for auto and student loans.

The overall increase pushed consumer borrowing to a seasonally adjusted annual level of $2.43 trillion in May. That was just 1.7 percent higher than the nearly four-year low of $2.39 trillion hit in September.

Borrowing is a sign of confidence in the economy. Consumers tend to take on more debt when they feel wealthier. That boosts consumer spending. Ultimately, it gives businesses more faith to expand and hire. But an increase in credit card debt can also be a sign of people falling on harder times.

The economy added just 18,000 jobs in June, the fewest in nine months, the Labor Department said Friday. It was the second straight month of feeble job growth. The unemployment rate rose to 9.2 percent, the highest rate of the year.
________

"Borrowing is a sign of confidence in the economy"

If that's the case, then the Federal Government is doing a lot better than we thought...

[pollyannaish]

I think they could be misreading this. Attires an increase in borrowing is the last ditch effort to keep things going for a smidgen longer.