The American consumer appears to have religion. Consider these two data points.

The second TALF auction closed today with a measly $3 billion of participation by the Fed. It’s not that the program isn’t working — investor demand for the securities is strong — there just isn’t that much consumer credit out there to securitize.

That brings us to the other data point. The Fed announced today that consumer credit outstanding decreased at a rate of 3.5% in February. Revolving credit (credit cards and home equity lines) decreased at an annual rate of 9.75% while non-revolving credit (auto loans, student loans) increased 0.25%. The consumer isn’t borrowing.

It’s probably a mistake to count out the American consumer but if they have turned over a new leaf, what does that do to the governments plans to goose the recovery through consumer spending?

more: here and here