People still appear to want credit but banks are suddenly getting less anxious to loan. The article states, "The big news is access to credit. It is suddenly very hard to get and this looks like the situation that existed at the start of the recession in 2008 [2007 actually]. The overall economy didn’t look all that bad in late 2008, except that there was a dearth of credit and that soon led to business failures and struggles."
In a Ponzi scheme, the main thing of importance to watch is the energy source of the Ponzi. In the case of a debt Ponzi, that energy source is the acceptance of new debt. It takes two to tango here. Someone must offer credit and some counter party must incur debt. It looks like the banks have run out of credit worthy counter parties. These numbers seem to be falling even more quickly than they did in late 2008. Back then they were trending down slowly giving market participants the chance to begin bailing out in 2007. This time the charts actually had a slight upward slope until the bottom dropped out. I bet a lot of people got blind sided by this.
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