Creditworthy customers are hard to find and in an uncertain job market, US Commercial banks aren't taking any chances.
According to David Rosenberg, ''In the third quarter, it contracted at a record $1trillion at an annual rate (over 9% decline - also a record).''
Here's a link from the New York TimesLink: Poll Reveals Trauma of Joblessness in US
It's obvious why banks are just refusing to go all out issuing loans again - they don't want any more non performing loans. This downturn is far from over, and the banks know it.
Over the last couple of weeks, large U.S. Financials have been raising more capital via fresh equity issues.Yes, yes repaying the TARP! They want to get their 'equity dilution' done while the going is good.!
And yes, while they may be going slow on the lending front, they are 'confident enough' of the uncertain business environment ---- to go ahead with bonuses to bankers this Christmas.
But there again, if you had the U.S. Treasury and the FED to backstop your losses and bail you out of crazy leveraged transactions - you would be confident too!!