Wednesday, April 18, 2007

Credit Card Delinquencies

In the press, Moody’s reported yesterday that credit card delinquencies continued to rise through February. Additionally, UBS reports that "the repayment rate on credit card balances fell to 17.27% in February from 20.03% in January—the lowest repayment rate in over a year and a sign that financial stress is building at the household level." UBS also mentions today’s Wall Street Journal (Pg. A8) discussing "how the Option ARMs market may be the next headline-maker in mortgage space." and how in today’s NY Times, "how China is becoming 'less' reliant on US exports as the value of the Dollar falls. The article highlights the imbalances that could further heat up trade frictions between the two countries. As they say, 'China is still nearly 25 times as dependent on exports to the United States as a percentage of total economic output as the United States is on exports to China. Given that the Chinese economy is less that a quarter of the size of the American economy, it is all the more striking that Chinese exports to the United States are worth more than six times American exports to China.' ”


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