As you can see from the data below, total consumer credit has been pretty much flat since April.
Dec 00 1531469.28
Jan 01 1548813.36
Feb 01 1563664.04
Mar 01 1570990.34
Apr 01 1584421.39
May 01 1590958.37
Jun 01 1589191.39
Jul 01 1588614.82
Aug 01 1590908.77
($ millions)
Also of interest is the Fed's "Household Debt Service Burden", which measures debt service payments as a percentage of disposable income. Since Q1-1980, this has ranged from about 12% to a little over 14%. Most of the time, it runs in the 13-13.75 area, going lower as we come out of recessions (lowest readings, 11.84%, were in Q4-1993). It was around 14 during '86-'87 and the first half of this year (Q2 was 14.04%).
I'd expect the burden to come down, BTW, in Q3 and Q4 reports as interest rates have dropped sharply. Almost half the burden is mortgages, so the current refi boom will bring that down. The rest, "consumer credit", can also benefit from low mortgage rates as people do "cash-out" refis to pay off other debts and as car loans and such are made at lower rates.
In short, there's no evidence to support your alarm over debt.
Bob |
