by Michael Snyder, The Economic Collapse Blog:
U.S. consumers have piled up the largest mountain of household debt in the history of the world. If the federal government was not almost 36 trillion dollars in debt, the fact that U.S. households are nearly 18 trillion dollars in debt would be making a lot more headlines. Sadly, our entire society is absolutely saturated with debt at this point. Government debt on all levels is spiraling out of control, corporate debt has ballooned to absurd levels, and consumers have been gorging on debt as if there will never be any consequences. Unfortunately, a time of reckoning has arrived, and it is going to be incredibly painful.
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On Wednesday, we learned that total credit card debt has surged to a brand new record high of 1.17 trillion dollars…
Collectively, Americans now owe a record $1.17 trillion on their credit cards, according to a new report on household debt from the Federal Reserve Bank of New York.
Credit card balances rose by $24 billion in the third quarter of 2024 and are 8.1% higher than a year ago.
Needless to say, incomes have not increased by 8.1 percent over the past year.
So our credit card balances are growing faster than our paychecks are, and that is a problem.
Meanwhile, total student loan debt has reached a brand new record high of 1.61 trillion dollars. If you can believe it, a whopping 30 percent of all student loan borrowers have “gone without food or medicine due to their monthly bills”…
- Thirty percent of federal student loan borrowers say they’ve gone without food or medicine due to their monthly bills, the Consumer Financial Protection Bureau finds.
- In addition to skipping necessities, 38% of people with federal student loans said they carried credit card debt that they wouldn’t have otherwise, the bureau found.
- Around 44% of borrowers said their education debt delayed when they could by a home, and 26% said the debt pushed back when they’d start a family.
If you are a young person that is considering going to college, please try to avoid piling up student loan debt.
It can haunt you for decades.
Overall, total household debt in the United States has skyrocketed to a brand new record high of 17.94 trillion dollars…
The Federal Reserve Bank of New York’s Center for Microeconomic Data today issued its Quarterly Report on Household Debt and Credit. The report shows total household debt increased by $147 billion (0.8%) in Q3 2024, to $17.94 trillion.
What a nightmare.
How did we ever allow ourselves to pile up nearly 18 trillion dollars in household debt?
That is insane!
Our wild spending fueled solid economic growth for a long time, but now most consumers are just barely scraping by from month to month and businesses all over the country are deeply struggling as a result.
For example, U.S. retailers have announced the closing of 6,481 stores so far in 2024…
U.S. retail closures have reached the highest level since the COVID-19 pandemic, according to recent estimates.
As of Nov. 8, retailers have announced 6,481 store closures, an increase of 336 closures in just the past week, according to the latest data from Coresight Research. The majority of these closures were driven by American Freight, which is shutting all 329 of its locations as part of its parent company’s bankruptcy proceedings.
Meanwhile, the auto industry is having a very tough time adjusting to lower consumer demand.
Last week, we learned that Nissan will be eliminating “9,000 jobs and a fifth of its manufacturing capacity”…
Nissan Motor shares slumped 6% in Tokyo trade Friday, a day after the Japanese automaker said it would cut 9,000 jobs and a fifth of its manufacturing capacity as it struggles with sales in China and the United States.
On Thursday, Japan’s third-biggest automaker slashed its forecast for full-year operating profit by 70%. It said restructuring would cut costs by 400 billion yen ($2.61 billion) in the financial year to the end of March.
Ouch.
Stellantis is another automaker that has decided it is time to reduce production and lay off workers…
Stellantis is indefinitely laying off more than 1,000 employees at its Jeep assembly plant in Ohio as the automaker significantly reduces its inventory levels to match demand.
Stellantis, the parent company of Chrysler, Jeep, Dodge and Ram, issued Worker Adjustment and Retraining Notification (WARN) notices to the respective state and local governments as well as the United Auto Workers union.
The 1,100 layoffs at the Toledo South Assembly Plant will be effective as early as Jan. 5.
Sadly, I think that this is just the beginning of very tough times for the auto industry.
The tech industry is facing enormous challenges too. In fact, chipmaker AMD just announced that it will be reducing the number of workers that it employs globally by about 4 percent…
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