Whether it's through a new sense of discipline or merely because people are still afraid of ending up broke, consumer indebtedness continues to decline in America. The Federal Reserve released a study yesterday indicating that our collective debt fell by $60 billion in the quarter ended September 30. Mortgage debt was responsible for pretty much all of that, dropping by a total of $114 billion. Consumer indebtedness outside of mortgages or home-equity loans rose by 1.3 percent.
The downside of that falling debt is that it could drive consumer spending downward right along with it. But that doesn't seem to have been the case. In that third quarter, the Fed reports, consumer spending rose by 2.3 percent, the biggest gain we've seen so far in 2011.
And what of the brand-new holiday shopping season? So far, so good: retail sales for the Thanksgiving weekend were up 16 percent over last year. Shoppers spent an average of nearly $400 apiece.
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