Credit cards stay
in wallets again
Americans cut back on using their credit cards in August for a third straight month, a sign that consumers remain cautious about spending.
Consumers increased their borrowing $13.6 billion in August to a seasonally adjusted $3.04 trillion, the Federal Reserve said Monday. That’s a record and it followed a gain of $10.4 billion in July.
Once again, the increase in borrowing was driven entirely by auto and student loans. A measure of those loans rose $14.5 billion to $2.19 trillion.
But credit card debt dropped $883 million to roughly $850 billion. The decline could hold back consumer spending, which accounts for roughly 70 percent of economic growth.
The report highlighted trends that have surfaced in the post-recession economy.
The measure of auto and student loans has risen 8.2 percent from a year ago and in every month but one since May 2010. But credit card debt is essentially where it was a year ago. And it is 16.9 percent below its peak hit in July 2008 — seven months after the Great Recession began.
about D.C. fight
The U.S.’s biggest foreign creditor, China, said Monday it was concerned about the deadlock in Washington and urged all efforts to be made to avoid a default on the U.S. debt.
Vice Finance Minister Zhu Guangyao called for “concrete measures” to raise the debt ceiling before the Oct. 17 deadline and to protect the safety of Chinese investments.
“The U.S. is the world’s biggest economy and a major country issuing reserve currency. Safeguarding the debt is of vital importance to the economy of the U.S. and the world,” Zhu was quoted as saying by the official Xinhua News Agency. “This is the United States’ responsibility.”
China hopes the U.S. will address its economic problems, solve the debt ceiling dispute and “keep the recovery process in the U.S. and the world going,” Zhu said.
China holds $1.277 trillion in U.S. Treasury bonds, the most of any nation after Japan.
LNG site step
closer to reality
The companies seeking to advance a multibillion-dollar natural gas pipeline project in Alaska have a leading contender for the terminal site where gas would be liquefied and shipped to Asia, signaling that a decades-old dream could still become a reality.
Irving, Texas-based Exxon Mobil, Britain’s BP, Houston-based ConocoPhillips and Calgary, Alberta-based TransCanada Corp. announced Monday that the Kenai Peninsula town of Nikiski is the leading contender. Senior project manager Steve Butt said there are three or four other sites are still being considered — he declined to identify those — but said Nikiski has the land needed for the plant and the companies know they can route a pipeline there. Land acquisition work is underway.
Butt said the liquefied natural gas plant envisioned as part of the pipeline project would be 16 or 17 times larger than that plant.