Household Debt in the US Reached a Record High - Americans Owed $17.5 Trillion in the Fourth Quarter of 2023

In 2008, the debt reached $9.294 trillion—a sum that has nearly doubled in 16 years. We know what this has led to in the past: bankruptcies of financial institutions, reduced production, rising unemployment and general economic decline. More than 8.7 million Americans have lost their jobs and the global economy has fallen into a protracted recession

Guys, I came across an interesting post by Peter St Onge, Ph.D, which provides data from the New York Fed. In his post, he worried about the possibility of mass defaults as total household debt reached a historically high level of $17.5 trillion.

Since the start of the pandemic, the data shows that this figure has increased by $3.4 trillion, which is approximately $30,000 per household. In addition to this, there is also a $10 trillion federal debt, which means an additional $80,000 per household.

But I didn’t find anything surprising in Peter St Onge’s words, since in a recent article called Banks Expect Zeroing in 2004 I warned of an impending crisis. My words are now confirmed by the “Report on household debts and credits” as well:

“The average American family owes more than $400,000, and their annual income is only one-sixth of that amount...

It is also interesting that during the fourth quarter of 2023, credit card debt balances increased by $50 billion, reaching $1.13 trillion. At the same time, mortgage loan balances increased by $112 billion, reaching $12.25 trillion.

Auto loan debt also increased by $12 billion to $1.61 trillion, continuing to grow steadily since 2011.

Well, I think the summer-autumn season will be a hot time...

#financialcrisis #economy #financialinstruments #FRS