Through some genetic deficiency, I was perusing FRED's (Federal Reserve Bank of St. Louis) website a couple of days ago. I admit that I'm experiencing an unhealthy preoccupation with loan loss reserve trends. They have a wealth of schedules that report on such (in total, by region, by bank size).
Loan loss reserves are at historic low points (and they only show commercial and total losses, no consumer losses insofar as I can see). Anyway, I may just do something really geeky and start tracking these losses by bank size and region. If there is a credit problem as some have suggested, we should see it creeping in these numbers. It will be a bellweather of sorts. We'll see what develops.One thing I found truly interesting is that from 1984 to 2004 the number of banks in the US fell by 53%. I understood about consolidation (indeed that was one of my investment thesis that paid off in the past), but I've not seen this number. I thought it intriguing. My friends and colleagues can always count on me to pull a "Did you know?" thing out of my pocket. I pulled this one out today. The person I shared it with was kind enough to pretend to find it interesting. Enterprising readers may want to use this in their arsenal should they be in cocktail conversation and find that their erudition is challenged. Keep this handy, it may serve as a needed deflection. Trust me, someone will be impressed that you know this...and surely your banker will be impressed.