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Started By
Message
Credit card debt at historic levels
Posted on 6/12/23 at 8:15 am
Posted on 6/12/23 at 8:15 am
At present, credit card debt in the US is up to Almost 1 trillion. Alltime high.
Over increase fro last year is Up 17% year over year
The average is also at historic highs at 6,000 per person.
Rates avg 20% which is up year over year.
In the face of Inflation, this tells me that consumers are masking the impact of inflation with key term credit. This could be unsustainable.
I’d expect some sort of credit card bubble to burst which will create some turbulence in the economy. Not sure when tho.
Over increase fro last year is Up 17% year over year
The average is also at historic highs at 6,000 per person.
Rates avg 20% which is up year over year.
In the face of Inflation, this tells me that consumers are masking the impact of inflation with key term credit. This could be unsustainable.
I’d expect some sort of credit card bubble to burst which will create some turbulence in the economy. Not sure when tho.
8
Posted on 6/12/23 at 8:39 am to SlidellCajun
I do wonder what kind of impact payments resuming will have. Part of me guesses minimal to be honest because a shitload of people just won't pay their student loan bills, but that will have an impact on credit scores again. Either way the balances are only going to increase in about two months.
Posted on 6/12/23 at 8:56 am to SlidellCajun
But those points
Posted on 6/12/23 at 9:09 am to SlidellCajun
quote:
unsustainable
People have been using this term since 2018 when talking about housing prices, debt, credit cards, new car prices, student loans and a host of other things. Maybe one day they will be right.
Posted on 6/12/23 at 10:08 am to ronricks
I agree.
Could this be an early indicator?
Sure.
But there are other indicators better suited for "unsustainable".
Could this be an early indicator?
Sure.
But there are other indicators better suited for "unsustainable".
Posted on 6/12/23 at 11:07 am to SlidellCajun
Anyone with a brain knew this was coming… the pandemic and keeping up with the joneses was gonna catch up to the financially illiterate at some point.
Posted on 6/12/23 at 11:11 am to Lsut81
Will be interesting when student loans resume and all the keeping up with the Joneses people who were ALREADY living outside their means start losing their asses.
Posted on 6/12/23 at 11:32 am to USMCguy121
I met a couple recently that both have student debt and 1 is currently in school. We were talking economics and I mentioned that if I had student loans it would be best to budget like you are paying them and at least get interest in a hysa. They both had no idea what i was talking about and said they were spending the paused payments. LOL
Posted on 6/12/23 at 11:38 am to USMCguy121
quote:
all the keeping up with the Joneses people who were ALREADY living outside their means start losing their asses.
Hopefully it will mean they stop flying. Air travel the last 2yrs has been miserable.
Posted on 6/12/23 at 11:57 am to SlidellCajun
quote:Do you have this data in some kind of inflation-adjusted form? I think this $6K per capita is barely more than like 2009.
Credit card debt at historic levels
At present, credit card debt in the US is up to Almost 1 trillion. Alltime high.
Over increase fro last year is Up 17% year over year
The average is also at historic highs at 6,000 per person.
I've seen other data that show household savings are still near all-time highs as well.
I'd certainly like to be a part of the doom porn, but can we at least provide context?
Posted on 6/12/23 at 2:18 pm to Lsut81
quote:
Hopefully it will mean they stop flying. Air travel the last 2yrs has been miserable.
This, this and all of this x 1000!
To the OP, is this debt carried over from month to month and not paid on time or just a snapshot of cc debt total. Because I think more people are using credit cards for benefits and paying off monthly than have in the past.
Posted on 6/12/23 at 2:45 pm to SlidellCajun
I couldn't sleep at night with credit card debt. I have no clue how some do.
Posted on 6/12/23 at 3:39 pm to SlidellCajun
quote:
At present, credit card debt in the US is up to Almost 1 trillion. Alltime high.
This also includes the balances that are paid off in full every single month. Since this includes that "debt" which most here wouldn't even consider debt, the 20% interest rate doesn't apply to that full $1T. It would be nice to see how much is paid every month to see the amount of credit card debt subject to interest.
This is also completely meaningless unless it is in inflation adjusted values. I would be curious to see this based on income values as well as based on net worth values. All of this would be better than just nominal amount on credit cards. Would also be curious based only on the population of those who have credit card debt since that appears to be the $6k claim as the total population or total adult population would be well below $6k. I would imagine that might skew higher than overall average income.
Posted on 6/12/23 at 3:54 pm to SlidellCajun
Credit reporting is dumb, the way they report levels is dumb. I pay mine off every month, I try to pay them off early but I still show a couple grand in "debt" every month that simply doesn't exist. The only way I have found to get it to zero like if I was trying to maximize my score for a home loan is to keep it zero for an entire month. Some of my cards report the high balance for the month... that is stupid.
Posted on 6/12/23 at 4:17 pm to Suntiger
A snapshot of total accumulated credit card debt. Delinquincies are still well below the historical average, but it's been consistently rising since Q3 2021 and I can't help but think it will continue to rise as we see more layoffs and student loan repayments begin.
Posted on 6/12/23 at 5:07 pm to ronricks
quote:
People have been using this term since 2018…
Showing my yuppie age a bit, but I remember that term also being batted around in the mid 80s. I believe it was about the time that we went from being a net creditor nation to a net debtor nation.
I’m certainly not saying that the music won’t eventually stop, but the band has kept playing on since that time.
Something that one of my Econ professors laid on us back in the day, that I’ve tried to remember whenever there are predictions about this or that happening or not happening, and the predictions are based on current circumstances: "Every generation's memory is exactly as long as its own experience." --John Kenneth Galbraith
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