Fed Z1 for Q3, debt growing faster than GDP, household net worth in rapid decline

Fed Z1 was just released for the 3rd quarter are here are the key debt statistics charted against GDP:

And for absolute changes. This chart does pretty nicely tell you what the financial crisis was about:

Couple of notes:

  • Households de-leveraging at 1.2 per cent annualized pace
  • Household net worth down by 2.4 trillion USD
  • Fed leveraging more than accounts for the household de-leveraging
  • Credit market debt growing faster than total output

From the summary:

Debt of the domestic nonfinancial sectors expanded at a seasonally adjusted annual rate of 41⁄4 percent in the third quarter of 2011, about 11⁄4 percentage points faster than the pace registered in the second quarter.

Household debt declined at an annual rate of 11⁄4 percent in the third quarter, continuing the contraction that began in the third quarter of 2008. Home mortgage debt fell at an annual rate of 13⁄4 percent in the third quarter, slightly less of a decline than in the first half of the year. In contrast, consumer credit rose at an annual rate of 11⁄4 percent, the fourth consecutive quarter of increase.

Nonfinancial business debt rose at an annual rate of 31⁄2 percent in the third quarter, 1 percentage point slower than the pace registered in the second quarter of this year. Corporate bonds outstanding and business loans increased while commercial mortgage debt continued to decline, albeit at a more moderate pace than during 2010.

State and local government debt remained unchanged in the third quarter. Federal government debt increased at an annual rate of 14 percent in the third quarter.

At the end of the third quarter of 2011, the level of domestic nonfinancial debt outstanding was $37.8 trillion; household debt was $13.2 trillion, nonfinancial business debt was $11.5 trillion, and total government debt was $13.1 trillion.

Household net worth—the difference between the value of assets and liabilities—was $57.4 trillion at the end of the third quarter, about $2.4 trillion less than at the end of the previous quarter.

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