Credit crunch coming?

Are Americans facing a credit crunch?:

” The American Bankers Association (ABA) reported Tuesday that 4.09 percent of all credit-card accounts were delinquent in the third quarter, the highest rate on record, and said the weak job market was probably to blame.

But Morgan Stanley senior economist Bill Sullivan suggested there may be another culprit — the end of the mortgage refinancing boom.

“It is no coincidence that households found it more difficult to maintain current payment schedules just as the volume of refinancing activity began to dry up as the second half of the calendar year got underway,” Sullivan wrote in a research note Wednesday.

The refinancing boom, triggered as mortgage rates fell to the lowest level in a generation, offered homeowners a ready source of cash. Most consumers plowed that cash back into their houses, for new washers and dryers, carpeting or to build that new deck.

But others used it simply to pay bills, including their credit-card bills. Shut off the refi spigot, and you may have shut off the ability of some cardholders to pay. “

Shit hitting fan yet?