Wednesday this week, the Treasury announced officially that the TARP was dead as a dodo. The government was not going to buy any “toxic” assets, even though buying them had been the entire rationale for enactment of the EESA on October 3. Instead, the Treasury was said to be concocting a new plan, which the New York Times described as “aimed at unlocking the frozen consumer credit market.”

Memo to NYT: check the data on consumer loans published by the Federal Reserve System. The latest report, dated November 7, says: “Consumer credit increased at an annual rate of 1-1/4 percent in the third quarter. Revolving credit increased at an annual rate of 2-1/2 percent, and nonrevolving credit increased at an annual rate of 1/2 percent. In September, consumer credit increased at an annual rate of 3-1/4 percent.” Would you describe this report as indicating a “frozen” credit market? Total consumer credit outstanding in September, $2,588 billion, exceeded the average amount outstanding in any year from 2003 to 2007, the period of the credit bubble. See chart for consumer lending by all commercial banks.

Many banks have tightened lending standards recently, but credit continues to flow in huge volumes. If someone tells me these data are not sufficiently up to date to capture the present “frozen credit market,” I say to him: Show me your data. I’m open to evidence, but not much impressed by hysterical anecdotes.