American Private Debt: It's back with a Vengeance

American Private Debt: It's back with a Vengeance

According to recent reports from the Federal Reserve, Americans are back up their eyeballs in debt !!

The reports are saying the debt levels are real close to the 2007 levels.

I hope we aren't setting up another big crash.

Individuals and Companies are heavy.

Total Household Debt is around $13 Trillion.

Sounds like a *recovery* .... for Who is the question.

As Washington is struggling with debt and all its political ramifications, American companies and consumers are embracing it, running up record amounts in 2013.

Whether it's corporate loans, all quality levels of bonds or simple consumer credit, the debt party is back on in the U.S., whether it's in the boardroom or the living room.

Amid the financial crisis of 2008, the U.S. went into what economists call a "debt deleveraging cycle"—akin to a credit hangover, where the party has ended and everyone there decides to quit drinking cold turkey.

Somebody has clearly turned the lights back on, though, and corporate and individual buying is soaring.

There's some global impacts also discussed.

Read for details;
It's back with a vengeance: Private debt


Flow of Funds, Balance Sheets, and Integrated Macroeconomic Accounts - pdf FED report

reply to post by xuenchen


What choice do they have?

Our government has turned our economy from one based on manufacturing (they allowed the multinationals to go overseas for cheap labor) to one based on service.

The bankers got a bail out, and yet the government is still allowing them to create yet another BUBBLE by letting them continue the fraud in the derivatives market!

The credit that people are using is nothing more than digital 1's and 0's to begin with. The threat of becoming a slave based on fraudulent money and debt is coming to an abrupt end.

It isn't going to be pretty for anyone......

Im sure alot didnt choose to be in such debt.

Many may have lost there jobs and to keep ther bill paid borrowed.

I mean if they accept welfare there dirty commie lazy scum right?

Any idea of how much of your assets is held in bonds at present? That should provide you with the real size of your debt and how much of your country you thought you owned but actually don't.

I work for one of the largest financial institutions in my city, and over the past 4 years our incomes have stayed flatlined. Granted, I am still lucky to have a job, but with inflation rising over 4% annually, it's hard to stay afloat sometimes.

YOu think it's bad now, wait another year or two until these huge health-bail-out-premiums...not to mention the hefty deductibles.... start to impact what is left of middle America...and more and more rely on credit.
Less and less disposable income, less and less buying power.

More and more debt, another round of bankruptcies.


I really, really hope someone comes into this thread and proves that I am wrong about this.

reply to post by xuenchen


Very interesting. Reuters report claims the New York Fed said Total consumer debt stood at $11.15 trillion in the second quarter. That's a difference of just under $2 trillion. Wonder what the real figures are?


S&F btw

reply to post by DontTreadOnMe


Did I mention I specialize in consumer loans? I can tell you, people are definitely relying on credit. Badly.

reply to post by Emerys


What do you expect? It is prettymuch impossible to buy a new car or house without credit, the days of being able to save up for these things are long gone. So you either go into debt to get them, or buy used vehicles and rent. Used vehicles are such a scary gamble, one bad breakdown can ruin a "middle class worker" these days. Times are tough indeed.... My sister has bought a car before on credit, and she can't even get a loan without a cosigner for some dumb reason. It's all nuts.

DontTreadOnMe
YOu think it's bad now, wait another year or two until these huge health-bail-out-premiums...not to mention the hefty deductibles.... start to impact what is left of middle America...and more and more rely on credit.
Less and less disposable income, less and less buying power.

More and more debt, another round of bankruptcies.


I really, really hope someone comes into this thread and proves that I am wrong about this.

I was hoping I wouldn't get depressed after reading this thread.

Unfortunately, I have to agree with Everything you have said.

Ugh....

xuenchen
American Private Debt: It's back with a Vengeance

According to recent reports from the Federal Reserve, Americans are back up their eyeballs in debt !!

The reports are saying the debt levels are real close to the 2007 levels.

I hope we aren't setting up another big crash.

Individuals and Companies are heavy.

Total Household Debt is around $13 Trillion.

Sounds like a *recovery* .... for Who is the question.

I don't know where you got the idea that the debt went away since 2007 - well actually I guess I do, the media has been lying constantly that we are recovering. The vast majority of household debt never got erased. Some did from people losing there houses, but tons of new outrageous student loans took up much of that slack the last few years.

The banks are just as insolvent, States, cities and the federal government are even more insolvent, and yes households are just as insolvent.

There has been absolutely no recovery. None. Recovery is impossible without the majority of this excessive debt being removed from the system because it is a giant anchor weighing it all down. It is impossible for the governments to pay it off because the citizenry is already being taxed at about the max it will stand for.
This is because the majority of households are living to paycheck to paycheck - which is also why they cant pay off their household debts.

The Americans who are wealthy enough they could be taxed more won't put up with it, they will move their businesses, shelter their money from taxes, or shut down their businesses if they are not allowed to make what they deem to be a reasonable profit for the effort they put in.

So a crash is inevitable, it cannot be stopped because we are in far to much debt to come up with any kind of a payment plan that will ever pay it off. All we are waiting on is for the market to cut us off.