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[ This is the new episode of a current news that relates to the expected A? aftershocksâ? of the global financial crisis and the economic benefits of these events can trigger .]

By Jason Simpkins
and William Patalon III
Editors Money Morning

U.S. consumers have already lost their jobs at an accelerated pace.

The same is now set to get their credit lines.

But with so many Americans are already losing their main source of income? â their jobs? at a rate of more spiral is an economy that two thirds of their power derives from the end consumer spending up stuck in its worst funk since decades, because the same consumers lose their accounts last?

Before he remembered the way you: the U.S. economy in all regions since mid-October, which has become more difficult to obtain credit and loans decreased demand weakened, said the Fed’s report on a survey Regional economic integration has yesterday (Wednesday). The so-called? Beige Booka? A report? are published two weeks before the central bank policy makers meet on interest rate changes and â?? said that the retail, tourism and manufacturing expenses had decreased in most places the real estate markets as weak means ???????? and concluded that a commercial real estate industry?? weakened global â,? Bloomberg News reported.

? We study an economy not only in times of recession, but a recession, the fast-growing one?? Former Fed Governor Lyle Gramley, now senior economic adviser at Stanford Group Co.,
told Bloomberg Television . â?? It is certainly a gloomy report, but no, I think, worse than what you would expect the data [Wea there?? 'Ve have seen] coming in.â ????

The United States already in recession for a year, reported the National Bureau of Economic Research (NBER) in the week. This could generate economic punch 1:59 a huge financial crisis â?? Aftershock? that experts from many observers. Only two of the last 10 recessions since the Great Depression took place a full year. But it could well continue into 2010.
to understand the forces in play, Leta? S first look at the prospects for employment in the United States.

series Attenuation of pay for workers in service employment fell by 240,000 in October and the unemployment rate rose to 6.5% to 6.1% the previous month, reported the Bureau of Labor Statistics in early November. October?? S decline, the employment declines of 127,000 in August and 284,000 in September.

This means that employment in the United States dropped 1.2 million jobs in the first 10 months of the year, more than half of the decline occurring August, September and October.

government?? s number of unemployed for November Wona? t be published until tomorrow (Friday) â?? Although ATI? s should show that the U.S. economy lost jobs for 11 straight Months, reported Bloomberg News user .

a private report based on payroll data released Tuesday said

that U.S. companies eliminated 250,000 jobs in November â?? an amount much larger than expected and the most since November 2001, said ADP Employer Services, a division of payroll processor Automatic Data Processing Inc. (ADP). This would reduce the total number of job losses for the year to 1.5 million.

The ADP report prompted some analysts to raise their estimates of the loss of jobs for the weapon?? See tomorrow?? s Labor Department report. Among the new forecast a decline of 400,000 payroll Goldman Sachs Group Inc (GS) and a decrease of 450,000 Wachovia Corp (WB) economist. And the unemployment rate for November, probably to 6.8%, the highest doped ATI? S since 1993, a Bloomberg economists concluded.

world

of?? s largest economy put in its first recession since 2001, the company accelerates downsizing their ranks, with sectors such as banking, manufacturing and business services, even taking big hits.

<
p> The NBER announced on Monday that has the deterioration in the labor market is one of the key factors in the identification of this slowdown was the recession, although we are not Experience two consecutive quarters of economic contraction.

<
p> According to some estimates, the U.S. job prospects? And a global economy? Will a lot worse before it gets better. Goldman Sachs Group Inc. (GS) said that the unemployment for the U.S. advanced 9.0% in the fourth quarter of 2009, corporate profits fell almost 25 A %???? and thatâ? s, following an estimated decline in profits of about 10% this year, said Goldman. <

br /> In fact, the U.S. economy? as measured by gross domestic product (GDP) â?? decline of 5.0% during the quarter, followed by a decline of 3.0% in the first quarter of 2009 and 1.0 % in the second quarter forecast, Goldman.

These figures are worse than initially expected Goldman and create a similar perspective to Money Morning? s projections for a financial crisis fueled economic downturn called, which could last as long as 12-18 months

economic cycle. Committee of the NBER, a private management, non-profit economic research group, on Monday officially announced that the recession began in the U.S., after the economy reached its peak in December 2007. The U.S. Department of Commerce estimates that U.S. GDP grew by 0.9% in the first quarter and 2.8% in the second quarter. The third order quarter, GDP fell by about 0.3%.

line loss of consumer credit could make everything worse.

trillion of credit lines on the latest

Block Over trillion consumer credit could in the next 18 months, as the credit card companies will reduce, withdraw to lines of credit in anticipation of problem-loan financing and regulatory changes, “said Meredith Whitney, an Oppenheimer Holdings Inc.. (OPY) analyst Whoa Bank?? is known for his courage and foresight to demand (and ultimately correct) known.

All week warned that the mortgage market Whitney a contract for the first time in the coming months. More importantly, however, Whitney said that the credit card market 18 months too late to reap the credit card companies more billions of lines of credit, under consumersâ? second important source of liquidity, following the jobs.

. â?? And in all the areas that you saw the big banks start command so much market share in key products such as mortgages and credit cards to draw lines in the third quarter and thatâ? will continue in the fourth quarter. And thatâ? Will in 2009.â ????

Although some experts â note that consumers continue to reduce their spending during the recession?? and needless to say, after they lose their jobs?? ATI? is important to not confuse the issues and loans. While say, many consumers are increasingly using credit cards while reducing overall spending, using credit cards, home equity lines and other forms of borrowing as a lifeline for resolving them. For the consumer can reduce credit line be personally devastating, and can aggregate in a more pronounced slowdown, even in spending.

Over 70% of U.S. households had access to credit and 90% of people use these credit cards as a vehicle for cash management, payments, or switch at least once a year, “said Whitney. <

br />

A surprisingly small number of national companies dominate the lending large arteries â?? â? including credit lines, mortgages and credit cards??, have the consumer spending in the U.S. so long, including supported mortgages and credit cards. mortgage a wall with the collapse of U.S. real estate market and the wave of subprime-made defaults. But credit cards could be next business raising interest, tightening lending standards, cut credit lines and close even millions of accounts in an effort to protect consumers default values.

Bank of America Corp. (BAC), Citigroup Inc. (C), JPMorgan Chase & Co. (JPM) â?? that more than half of the credit lines of the United States at the end of a controlled third quarter?? discussed reducing their exposure to credit and reductions in growth, according to Whitney

/>? Yours? starts that consumers really on their lines of credit card data? ? Whitney said stretched. A people? Think shoes next to fall cost the credit card?? costs increase. No, ATI? S lines of credit from the bank lenders in anticipation of worsening problems in credit financing and regulatory changes drawn on horizon.â ????

Whitney that the market for credit cards start, fell by mid-2010, a time when the unemployment rate, he could at 9.0%.

? Just as consumers lose their jobs thatâ? s primary source of liquidity, their primary source of liquidity, they decide their second source of high liquidity, said her credit card online ,????, them.

In fact, as unemployment increases, so will default credit card. David W. Nelms, CEO of Discover Financial Services (DFS), the Reuters news agency user this card radiation may, in the mid-range of 5% in the fourth quarter and nearly 6% in the first quarter of 2009.

arrears

tend to follow the rate of unemployment, “said Nelms Reuters by a speech to the Executive Club of Chicago. “Most people agree that things tend to get worse next year.”

lenders still of losses related to subprime mortgages, Cana? T afford another round of defaults on credit cards. Sun theyâ? Ve began pulling credit lines, so that consumers in the cold. And ITA? S, which is worse, “said Whitney.

expert believes the crisis of the change in Consumer Psychology

Investment expert R. Shah Gilani â??? A retired hedge-whoa Manager?? s chronicles of the credit crisis, one morning silver / strong>, the contribution of an editor?? na? t surprised Whitneyâ? predictions.

?? This is already happening in a big way, â?? Gilani said on Whitneyâ? S assertion that credit lines were threatened. â?? I have with people who had cut their credit lines said, cut it in two halves. I would not so I? ? Do not be surprised if turns out to be an accurate billion figure.â ????

Gilani by the evaporation of billions in the credit markets could be the kiss of death for American consumers.

? A number of high that makes you grab enough to consider the quantitative impact on consumer spending, â?? Gilani said. lucky â?? Thereâ? its great that the American consumer is not only on the screen, but was removed from the ring.â ????

U.S. consumers to reduce spending by 1% in October, the biggest drop since the last recession in 2001, said the Government last week. rushed

U.S. retail sales 2.8% in October â?? the largest monthly decline since the Commerce Department, the countdown monthly retail sales in 1992 has begun. The decline in sales for the fourth consecutive monthly decline and the decline for the first time marked since 1992. And few have a hope for the Christmas season, consumer confidence is also declining. The Reuters / University of Michigan index of consumer confidence in an ultra-low clocked 55.3 for November, from 57.6 the previous month.

The reading was far from the projected 57.7, told Reuters , and a?? in even worse? deteriorated since the middle of the month, even if gasoline prices seen as a bright spot for consumers. The index of trust of the University of Michigan was in 1952. His record high 51.7, it made May 1980.

Again, employment, liquidity and confidence crisis were the main issues, said the survey report.

? Consumer confidence fell in the second half of November were due to job losses, falling incomes and evaporation of the household wealth, â?? the report. â?? consumers? in the knowledge that the economy was unanimous in recession, and expects nearly three out of four, that the recession will deepen in the coming months ahead.â ????

However, Gilani, who is also editor of the Trigger Event strategist ???? commercial service specifically for investors this maneuver to help the economic malaise? also believes that what investors are witnessing a different â?? aftershocks? the ongoing global financial crisis.

? What actually happened is a change in psychology that motivates consumers by such factors as socio-economic climate was? and the environment? and thatâ? s now by credit conditions, a? been added? Gilani said. force â?? These banks and credit card debt and the American to make consumers same.â ????

The problem is, he says, can it thatâ a cycle?? s difficult to stop once it takes hold.

?? if the Americans have lost confidence in the market or simply Cana? afford t it to repay loans, capital flows easily dried UPA? Gilani said. â??? So banks were forced to their lending standards to increase to a point that many Americans today do not answer. It is to experience a vicious cycle cycle.â ????

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