Tuesday, August 15, 2017
Greetings Thrifty Friends,
Talk about timing. Just last week we were talking about the wealth gap and how it is getting wider, and this week a story appears in The Wall Street Journal online announcing U.S. household debt has reached a new record.
And what is driving all of this new debt? Credit card spending and auto loans (among other things).
You can blame the politicians and the economy, and justifiably so, but judging by these results some of the blame has to lie with the consumer as well.
Please scroll down for a few details.
Keep pinchin' those pennies,
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TODAY'S THRIFTY TIP:
U.S. household debt reached a new record of $12.8 trillion in the second quarter, driven by rising mortgage debt, a strong quarter for auto loan originations, and an uptick in credit-card balances, which reached their highest level since 2009.
Today's report marked the 12th consecutive quarterly increase in household debt, as Americans continue to re-embrace credit as the financial crisis recedes into memory. The total volume of debt is now $1.7 trillion higher than it was in 2013, according to the Federal Reserve Bank of New York's quarterly report on household debt and credit.
While overall debt has increased, the figures aren't adjusted for the growth of the population or the economy. Total debt was 67% of the nominal gross domestic product in the second quarter, down from as high as 87% in 2009.