Graph #1: Household Borrowing in Billions of Dollars (blue) and

Household Debt Service Payments in Billions of Dollars (red)

Take household debt and look at the "change from year ago" values: That's household borrowing, in billions of dollars. That's the blue line.Take household debt service payments "as a Percent of Disposable Personal Income" and convert it to household debt service payments in billions of dollars. That's the red line.Look at what happened after the 2001 recession:Household borrowing (blue) rose sharply until it reached the ceiling set by debt service payments. Then it fell back. This happened in 2003. It happened again in 2004 and again in 2005 and again in 2006. It is as if lenders would lend no more than they could get paid back in a year... or borrowers would borrow no more than they could afford to pay in a year.In 2007, after the fourth attempt, household borrowing went into free fall. You know what happened after that.