The era of the more frugal U.S. consumer continued in December as total consumer debt fell by $1.73 billion, marking the 11th straight monthly decline, the U.S. Federal Reserve said Friday. There's no doubt that Americans are getting serious about paying down credit card balances and other debt.Further, although December's total consumer debt decline was considerably less than the Bloomberg News consensus estimate of $8.4 billion, it closed out a year of a substantial reduction in both credit-card use and in the total consumer debt held by Americans.

For all of 2009, total consumer debt dropped 4% to $2.46 trillion from $2.56 trillion in 2008. It was the first annual decline in total consumer debt since 1991, and only the second since 1945.

In December, revolving debt, which includes most credit cards, fell at a 0.98% annual rate or by $8.5 billion to $866.0 billion; revolving debt totaled $957.3 billion in December 2008. Non-revolving debt, which includes auto loans and personal loans, increased at a 0.43% annual rate or by $6.8 billion to $1.591 trillion. Non-revolving debt totaled $1.602 trillion in December 2008.

A perfect storm of factors coalesced during the recession between 2007 and 2009, resulting in steadily declining consumer credit balances. Stagnant incomes in many job segments, the loss of more than 8.4 million jobs from the workforce, and reduced credit lines and higher interests rates by banks and card issuers have prompted Americans to reduce credit balances over the past year.

With 2009 behind us, you can call it a year for the record books, as over-extended Americans paid-down balanced on their credit cards. At least short term, Americans are weeding out unnecessary and frivolous consumption. However, longer term, increased credit lines, as well as higher consumption by those Americans with the incomes and assets to tolerate them, will be needed for the U.S. economic expansion to achieve historical growth rates.