Read the Beforeitsnews.com story here. Advertise at Before It's News here.
Profile image
Story Views
Now:
Last hour:
Last 24 hours:
Total:

Household Debt Is Increasing In USA

% of readers think this story is Fact. Add your two cents.


Statistics released for the first quarter of the year are quite grim since consumer debt is on the rise, reaching $12.73 trillion. This is more than the peak that was recorded in 2008. Close to 11% of the total debt is coming from student loans. As contrast, in 2003 student debt was 3.3% in 2003.

US citizens basically borrowed much more than they did when the credit bubble crisis hit in 2008. At the same time, the entire global financial system is collapsing. This affects all industries as consumers are more in debt and spend less. Statistics show that people are even betting less on websites like casino.netbet.it, which was supposed to go up but did not.

The New York Federal Reserve Bank declared that the total household debt reached the brand new peak mentioned, all according to what was registered in the period between January and March. This is an important milestone as the US economy is trying to recover, with results not being as great as they should have been.

What should be mentioned is that the growing debt in the country is indirectly connected with the recession. People that did have credit problems and did not qualify for loans during those times managed to repair credit scores. Since loans were taken out at this high level, it is obvious that there is an optimism coming from people about a potentially rising economy.

Debt will fuel spending, which is 70% of the US economic activity. Americans are making investments in housing and education. This builds financial stability and personal wealth. However, at the same time, it does increase debt.

The important fear of the moment is that student loan debt is going to balloon, more than with auto loans or credit card related debt. Unfortunately, this practically means that many US citizens can end up in a really black hole, leading to new defaults, similar to what we noticed with the mortgage meltdown that appeared 10 years go.

According to Heather Boushey, Washington Center for Equitable Growth chief economist:

“This is not a marker we should be superexcited to get back to. In the abstract, more debt signals optimism. But in reality, families are using debt as a mechanism to pay for things their incomes don’t support.”

Financial education teaches us that whenever debt is used to cover for things that cannot be afforded, it is only a matter of time until something bad happens with finances.  Ever since WWII we have had household debt increasing, with minor interruptions appearing. It was the financial crisis that managed to change this steady upward march. We saw a decline in household debt in 2008. It lasted 19 quarters in which US citizens did not want to borrow. The rise started again in the year 2013.

On the whole, while in some cases household debt growing up is beneficial but if we are to look at the bigger picture, this is not something America should be happy about. It is a sign that another financial crisis may appear in the future.

 



Before It’s News® is a community of individuals who report on what’s going on around them, from all around the world.

Anyone can join.
Anyone can contribute.
Anyone can become informed about their world.

"United We Stand" Click Here To Create Your Personal Citizen Journalist Account Today, Be Sure To Invite Your Friends.

Please Help Support BeforeitsNews by trying our Natural Health Products below!


Order by Phone at 888-809-8385 or online at https://mitocopper.com M - F 9am to 5pm EST

Order by Phone at 866-388-7003 or online at https://www.herbanomic.com M - F 9am to 5pm EST

Order by Phone at 866-388-7003 or online at https://www.herbanomics.com M - F 9am to 5pm EST


Humic & Fulvic Trace Minerals Complex - Nature's most important supplement! Vivid Dreams again!

HNEX HydroNano EXtracellular Water - Improve immune system health and reduce inflammation.

Ultimate Clinical Potency Curcumin - Natural pain relief, reduce inflammation and so much more.

MitoCopper - Bioavailable Copper destroys pathogens and gives you more energy. (See Blood Video)

Oxy Powder - Natural Colon Cleanser!  Cleans out toxic buildup with oxygen!

Nascent Iodine - Promotes detoxification, mental focus and thyroid health.

Smart Meter Cover -  Reduces Smart Meter radiation by 96%! (See Video).

Report abuse

    Comments

    Your Comments
    Question   Razz  Sad   Evil  Exclaim  Smile  Redface  Biggrin  Surprised  Eek   Confused   Cool  LOL   Mad   Twisted  Rolleyes   Wink  Idea  Arrow  Neutral  Cry   Mr. Green

    MOST RECENT
    Load more ...

    SignUp

    Login

    Newsletter

    Email this story
    Email this story

    If you really want to ban this commenter, please write down the reason:

    If you really want to disable all recommended stories, click on OK button. After that, you will be redirect to your options page.