If the world's biggest economy is really on the upswing, thenwhy are America's banks stockpiling a record amount of ultrasafebonds?

After all, jobs are back, the Federal Reserve is close toraising interest rates again and growth has perked up after asluggish first half. But instead of ramping up lending to keep upwith deposits, banks are plowing into U.S. government and relateddebt at the fastest clip since 2014.

The easy answer, of course, has to do with post-crisis financialregulations, which were designed to curb risk-taking and havecompelled banks to hold more high-quality assets. Yet in many ways,the buildup reflects a more worrying sign. In the past year, moreloan officers at large and midsize banks have tightened credit tobusinesses than at any time since 2009, when the U.S. was stillreeling from the housing bust. Americans are also saving morerather than taking on extra debt, damping demand for new loans.