# Professor Johannes Stroebel's research on the impact of credit extension on the economy

1 October 15, 2015 ![Bloomberg logo](/sites/default/files/styles/246w/public/assets/images/bloomberg_0.jpg?itok=qy2YlnxP)>

Excerpt from [Bloomberg](http://www.bloomberg.com/news/articles/2015-10-15/fed-rate-decision-qe-didn-t-quite-cut-it-so-now-what-) -- "In a working paper for the National Bureau of Economic Research, a group of researchers looked at 8.5 million credit card accounts. They found that for every 1 percentage point reduction in what it costs banks to borrow, banks extended $127 in credit to families with credit scores below 660. Those families spent 58¢ for every new dollar in credit. Under the same conditions, families with credit scores above 740 got $2,203 in extra credit. But they didn’t spend a penny of it. Says [Johannes Stroebel](http://w4.stern.nyu.edu/faculty/bio/johannes-stroebel) of the NYU Stern School of Business, one of the authors: 'The targeting of these credit expansions is potentially to the wrong people, to the people that don’t want to borrow more.'"

[Read more](http://www.bloomberg.com/news/articles/2015-10-15/fed-rate-decision-qe-didn-t-quite-cut-it-so-now-what-)