Americans’ love affair with debt persists, even with interest rates gradually inching higher.
According to the Federal Reserve Bank of New York, total U.S. consumer debt jumped to $13.5 trillion in the third quarter. The debt is driven by the $9.1 trillion in mortgages.
Interestingly enough, this amount is $837 billion higher than the previous peak in 2008, just before the economic collapse.
Among the biggest debt concerns is the student loan debacle, which totals $1.4 trillion. But the most fascinating trend in the student debt realm is the serious delinquency rate (90 days or more) as it climbed to 9.1 percent in the July-to-September period, up from 8.6 percent in the previous quarter.
Automobile and credit card debts have also topped $1 trillion.
It is going to cost a whole lot more to service this debt. Previous studies have already found that rate hikes are costing consumers billions more every year.
When the next financial crisis happens, it won’t just be housing that will cause the nation’s demise. There will be many factors: asset bubbles, debt, inflation, and many others.
When the currency that the People use has no intrinsic value, and debt is the normal way of life because the Federal Reserve, and the banking system in the nation promote’s that debt.
What else can be expected?
But debt always causes an eventual crash; always has, always will.