Total debt outstanding in the economy is still growing, but at the slowest pace on record. The household has decreased its debt for 4 straight quarters. You can see just how unique this debt deflation is, given that household debt had previously never fallen year-over-year in the recorded history of this data series. The household sector isn’t the only one: the finance and corporate sectors are also putting in their first ever declines in debt during this recession. We don’t include charts of those sectors because they all look just like the household one above. In fact, the sum of all non-federal debt is falling. The process of elimination tells you who is keeping overall debt creation positive: the US Government, which has grown its debt outstanding by $2.2 trillion since the first quarter of 2008. This is a big number, when considering that it comes off a base of $5.3 trillion.
