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> Consumer balance sheets are strong. Consumer debt is at record highs for overall debt, and household credit card debt is climbing towards record levels. htt
by camhart 4y ago
> Consumer balance sheets are strong.
Consumer debt is at record highs for overall debt, and household credit card debt is climbing towards record levels.
https://www.google.com/amp/s/www.cnbc.com/amp/2022/05/10/household-debt-nears-16-trillion-despite-rising-rates-and-inflation.html https://www.google.com/amp/s/www.cnbc.com/amp/2022/05/10/hou...
https://www.google.com/amp/s/www.cnbc.com/amp/2022/05/10/consumer-credit-card-debt-near-an-all-time-high.html https://www.google.com/amp/s/www.cnbc.com/amp/2022/05/10/con...
- tfehring 4y agoThe fastest-growing (and largest) category of that debt was mortgage debt, which is probably a positive economic indicator if anything, though note that that's based on Q1 data. Household debt servicing costs as a percent of disposable income are still lower than at any point between 1980 (the earliest data available) and the start of the pandemic. https://fred.stlouisfed.org/series/TDSP https://fred.stlouisfed.org/series/TDSP Also keep in mind that those debt figures are in nominal USD. One positive effect of inflation is that it reduces the real cost of paying off debt.
- mym1990 4y agoIs this a positive effect? I think it is for lower inflation rates, but above a certain threshold the borrowing can get out of hand, people will go and get more loans, which will drive prices higher. Eventually the bubble pops and people go underwater.