Since the economic collapse, United States consumers have done an admirable job in trying to rein in their debts, one of them being credit card debt. For a couple of years now, credit card debt has stood below the $1 trillion mark, and has been surpassed by student loan debt. But that may be changing in the coming months.
According to new data from CardHub.com, a credit card information website, U.S. credit card debt is nearing $1 trillion. This is due to consumers’ appetite for debt and borrowing once again – we have regularly reported on how Americans are borrowing once again (SEE: Americans take on more debt as Fed proclaims end of ‘deleveraging era’) and overextending themselves.
Last year, credit card debt jumped $71 billion, and $52 billion of that transpired in the fourth quarter. This has been attributed to the exorbitant Christmas shopping endeavors by consumers. What’s interesting is that the average credit card debt rose $5,700 per household, and the average month-to-month, balance-carrying for households is $16,000.
The fourth quarter for credit card debt was so bad that it equaled credit card debt for the entire years of 2009, 2010 and 2011 combined.
Ostensibly, the U.S. is No. 1 when it comes to owning credit card debt. It’s double that of the United Kingdom, and equals to Canada, Mexico, France, Russia, China and Japan combined!
“It is something we need to keep an eye on if borrowing continues to grow rapidly,” Moody’s Analytics’ Scott Hoyt underscored in a report on credit card debt told VOA News. “The implications of rising credit card debt would similar to what happened in the recession, when consumers became overly leveraged.”
What’s driving this surge in debt? CardHub suggests a couple of things: paying with plastic, banks marketing credit and consumers resorting to bad habits that were quite common prior to the economic collapse.
The truth is that with wages staying flat (or going down when adjusted for inflation) for many over the last 20 years, more families are having to use credit to maintain the illusion of a middle class standard of living. Robbing them of any real gains in income. Price inflation is killing the middle class. My income has gone up 60% in the last 20 years, but prices for almost everything I purchase has gone up more.
I am now spending more feeding 2 people than I did feeding 6 people in 1998. The bottom 50% of households are become poorer every year. As monthly disposable income buys less and less.
Couple that w/ Obama’s and Hillary’s desire to increase the minimum wage of the proletariat who are too stupid to figure out that by increasing the minimum wage the cost of living will increase proportionately. Hence, any gains the proletariat will have will be offset by loss.
MT voted in a minimum wage increase, indexing it to inflation, not a big jump each year. That is the way to do it. Minimum wage has increased from $7.25 to $8.05 not a huge increase in 8 years, our fast food prices are still lower than many states.
The minimum wage increase will push other wages up, that is why most businesses are against it. Most are already working for slave wages, considering what prices have gone up over the last 30 years.
The economy has not really grown, it is only presented that way. People are living off their credit, and should there be another economic down turn (there will be) we will see a repeat of 2008 but in larger fashion.
This is another puzzle peice in creating an economic collapse, Always remember:
An Empty Stomach makes for a Willing Slave.
Just think how well off we would be without government holding us down.
Their relentless extravagant and wasteful spending all over the globe. Their outrageous taxes just going into their pockets without producing any interest.
Getting rid of many of their laws and rules and regulations, this country would flourish.
We are watching the destruction of our country from the inside and dare I say by a muslims contempt.