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Credit, CP, and ABS all grow again.; entered at 2007-12-02 15:00:53

Gmak
Posts: 10179
Registered: 2007-07-27 Re-inventing the future at the speed of time.

So long as Bank Credit keeps growing, deflation is averted or tempered somewhat. Note that ABCP didn't grow last week, just CP.
Interesting that foreign holdings of Treasuries and Agencies grew slightly in the week. Has the great flight from USD ended? Or is this a temporary aberation?

http://www.prudentbear.com/index.php?opt....

Quote:

Bank Credit surged $73.1bn during the week (11/21) to a record $9.219 TN. Bank Credit has posted an 18-week gain of $575bn (19.2 annualized) and a y-t-d rise of $922bn, a 12.3% pace. For the week, Securities Credit jumped $39.9bn. Loans & Leases rose $33.2bn to $6.731 TN (18-wk gain of $406bn). C&I loans surged $21.9bn (2007 growth rate 21.8%). Real Estate loans gained $13bn. Consumer loans added $2.3bn. Securities loans declined $16.4bn, while Other loans increased $12.4bn. On the liability side, (previous M3) Large Time Deposits fell $23bn.

M2 (narrow) “money” supply rose $17.3bn to $7.420 TN (week of 11/19). Narrow “money” has expanded $377bn y-t-d, or 5.9% annualized, and $449bn, or 6.4%, over the past year. For the week, Currency dipped $1.0bn, and Demand & Checkable Deposits sank $23.2bn. Savings Deposits surged $32.2bn, and Small Denominated Deposits added $0.1bn. Retail Money Fund assets rose $9.2bn.

Total Money Market Fund Assets (from Invest. Co Inst) jumped $26.3bn last week to a record $3.073 TN. Money Fund Assets have now posted an unprecedented 18-week surge of $489bn (58% annualized) and a y-t-d increase of $691bn (31.4% annualized). Money fund assets have ballooned $744bn, or 31.9%, over the past year.

Total Commercial Paper gained $12.7bn to $1.854 TN. CP is now down $369bn over the past 16 weeks. Asset-backed CP declined $8.0bn (16-wk drop of $333bn) last week to $841bn. Year-to-date, total CP has contracted $120bn, with ABCP down $243bn. Over the past year, Total CP has declined $74bn, or 3.8%.

Asset-Backed Securities (ABS) issuance increased somewhat this week to a still slow $3.5bn. Year-to-date total US ABS issuance of $513bn (tallied by JPMorgan) is running 38% behind comparable 2006. At $219bn, y-t-d Home Equity ABS sales are off 58% from last year’s pace. Year-to-date US CDO issuance of $290 billion is now 16% below comparable 2006.

Fed Foreign Holdings of Treasury, Agency Debt last week (ended 11/28) increased $5.7bn to $2.031 TN. “Custody holdings” were up $279bn y-t-d (17.3% annualized) and $320bn during the past year, or 18.7%. Federal Reserve Credit expanded $1.5bn last week to $869.6bn. Fed Credit has increased $17.4bn y-t-d and $25.6bn over the past year (3.0%).