Federal Reserve: Consumer Debt Keeps Dropping

The Federal Reserve has just released consumer spending trends for the month of March. Here are the figures:

Credit card borrowing fell by 6.8%. That's $5.4 billion saved! (Not as impressive as the $9.7 billion saved in February of this year, but still...)

Non-revolving debt, such as car and student loans, dropped by 4.2% (or $5.6 billion).

Overall debt decreased by 5.2%, or $11 billion. This is the largest drop in debt since December of 1990, according to Reuters.

Americans currently owe $1.6 trillion in non-revolving debt (like personal, auto, and student loans), and almost $1 trillion in revolving debt (like credit cards), for a total of $2.55 trillion.

Interestingly, private wages and salaries fell $32.9 billion in March. This would indicate that the $11 billion we cut in spending isn't nearly enough to adapt to our newly reduced household incomes. But at least it's in the right direction. 

Is the decreased consumer debt evidence of our sheer willpower to stop frivolous spending? Maybe, but more likely it's the result of banks and credit card companies just not lending as much, especially to those with subpar credit scores.