Economy & Policy

Less junk mail: the upside of the credit crunch

By Barbara Kiviat | August 11, 2008 | +

Grisly news today from the Federal Reserve’s July survey of senior bank loan officers. Loan-writing standards are tighter across the board, but especially for prime mortgages (74% of banks reported tighter standards, compared to 62% in the April survey), and credit card loans (67% of banks reported tighter standards, compared to 32% in the April survey).

The good news about how this plays out comes from the market research firm Synovate, which had a press release of its own today. During the second quarter, the number of credit-card offers received by U.S. households were down 17% from the same period a year ago. That’s only 1.06 billion pieces of junk mail, compared to the 1.27 billion we saw last year. HSBC, which used to really like subprime customers, cut back the most, down 54%. Citibank’s volume was down 45%—to its lowest point in more than 10 years.

Barbara!

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  • MountainGal

    So these companies come up with slick ads and promises; consumers fall for them; the U.S. economy suffers due to people’s lack of fiscal responsibly (and trusting these ads); so these same companies scale back their marketing efforts. What a mess. I hope in the future marketing efforts from financial institutions are required to have more clear language and really spell out what these people are signing up for, and I also hope people realize easy credit is not really a good thing.

  • Ajay_O

    Just another curious note. Why does Barbara always sign it with Barbara !….

    Justin come back, your blog is going through a Yahoo style takeover :)

  • Barbara Kiviat

    Glad to see you’re a curious capitalist, too, Ajay_O. As I explained long ago, I sign my name so that when people get their morning emails with our posts they know it’s me writing and not Justin. I initially included the exclamation point to be self-mocking. Now I do it to annoy a reader named Malcolm. Malcolm!

  • Aziz Musa

    There’s much more upside that this! If it wasn’t for the Credit crunch we wouldn’d have a euphemism for recession – Nor would we have coined ‘Credit Squeeze’ or allowed supermarkets to make offers so good that they “Price Crunch!”

    http://business-vs-technology.blogspot.com/

  • http://curiouscapitalist.blogs.time.com/2008/11/10/what-credit-crunch/ Curious Capitalist – TIME.com » Blog Archive What credit crunch? «

    [...] Synovate, a firm that tracks credit-card mail volume, today released its third-quarter figures. Not surprisingly, folks are getting a lot fewer offers in their mailboxes these days: 940 million pitches went out [...]

  • http://curiouscapitalist.blogs.time.com/2009/08/05/are-credit-card-companies-getting-their-groove-back/ Are credit-card companies getting their groove back? | The Curious Capitalist | TIME.com

    [...] of the nicer effects of the credit crunch has been less junk mail from card companies looking to sign you up. Is that [...]

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