Americans are increasingly having to take on more debt to make ends meet, according to the latest data from the New York Fed. A new report from the NYF shows that total credit card debt for America has reached a record high of $1.14 trillion.
More debt than ever
Across the board, Americans now have more student loan debt, mortgages, credit card debt and other forms of debt than at any other time in history.
“Total household debt rose by $109 billion in the second quarter of 2024, an increase of 0.6% from Q1 2024. The total balance now stands at $17.80 trillion and has increased by $3.7 trillion since late 2019, just before the start of the pandemic,” the Fed said.
By far the largest share of debt is mortgages, with student loans (9%) and car loans (9%) tied for second place.
Worryingly, the percentage of defaults on these debts has increased in the second quarter of 2024. Furthermore, it seems that the consumer is slowly getting into trouble. Which may also be the result of the ever-increasing debts in the United States, of course in combination with the relatively high interest rates.
Tired American Consumer
Rumors of a recession in the United States are growing, and Bank of America CEO John Moynihan sees a possible reason for it. He notes that the American consumer is becoming tired.
The American consumer is currently spending at about half of last year’s levels, he told FOX Business.
“They have money in their accounts, but they are getting a little exhausted. They still have their jobs, they are making money, but if you look at the data, they are really slowing down.
“So the Fed is in a position where they have to be careful that the consumer doesn’t slow down too much. The way consumers are spending now is consistent with the numbers from 2017, 2018 and 2019. Those were times of lower inflation and more normal growth in the economy,” the Bank of America CEO said.
In that respect, it is therefore important to be careful when it comes to the American economy. This is important for the Bitcoin price, because a recession would certainly not mean much good for the digital currency in the short term.
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Source: https://newsbit.nl/totale-creditcardschuld-vs-op-114-biljoen-ceo-bank-of-america-waarschuwt-voor-zwakke-consument/
