Your side note is very important. For folks out there that don’t understand how FICO is calculated, it is worth noting that it is extremely complex at the best, but there are somethings that can be generalized – especially for people with good credit.

Having a credit card disappear (one that you are not using, that is has zero due) decreases the overall credit available to you (as calculated by FICO). It you have large amount of loans, this could put your % loan ratio (loans divided by available credit) over 30% which is considered pretty bad by FICO, and your credit score could drop accordingly. However, if your ratio is below or well below the 30% ratio, there should be much affect on your score.

Tom

I agree that we are in a state of some equilibrium between inflation and deflation. The US dollar has been weakening the past few weeks.

However, I wonder about inflation since M3 has declined. Perhaps an interesting definition of money supply to consider is base money plus credit; since so much of our domestic economy is based upon purchases using credit. (RE, autos, boats, durables, etc.)

From a price perspective equities, real estate, and collectables (say 1964 Ford Mustang) are still decreasing in nominal price.

However, commodities and hard assets (e.g. gold, oil) are rising in price.

Thus, we might not call this stagflation but it might be close.

As a side note, I just had a credit card cancelled which has never happened before. Granted, it wasn’t a card we used but with two 700+ credit scores, normally we’d be extended additional credit instead.