If you tune into the news, or just take a look around your neighborhood and watch businesses coming and going, it can be hard to tell what’s really happening with the economy. For every sign of life, there seems to be another dark cloud. My fellow blogger Ilyce Glink has her eye on the real estate market, but, as we’ve seen over the last few years, jobs, real estate, debt, and credit are all tied together in the economy’s rise and fall.
It’s still too soon to call the end of the credit crisis, but when I look at the overall credit market, I’m seeing some positive signs. Consumer credit scores continue to improve, and average risk scores are also improving.
Why should you care? The underlying results of these improvements include lower delinquencies, lower write-offs, and revolving deleveraging of debt accompanying lower credit utilization.
Translation: Consumers are showing signs of making smarter credit decisions and reducing their debt.
Here’s a little insight into the data I see that makes me optimistic about consumer credit scores:
Overall, these recent credit score trends are a sign that we’re seeing movement toward economic recovery. The recession resulted in pervasive score declines in geographic pockets like California, Florida, and Nevada, but the areas with the worst score declines are now seeing larger score increases.
Make sure to come back next month, when I take a look at how specific industries and manufacturing have affected the economy.
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