The Economy

US Consumer Borrowing Climbs on Surge in Credit Card Balances

America is at full employment . ... Meanwhile, last night the Federal Reserve reported a rise in revolving credit card balances that is one of the largest in history as more and more Americans are relying on credit cards to meet basic expenses.

That, as the same report showed that average credit card interest had just hit a record high 20.9 percent.

To borrow from someone else on here, I'm sure it's all OK.

A recent poll by Morning Consult for Bloomberg News showed over half of Americans don’t have the financial resources to cover a surprise $400 expense without taking on debt.

What is stunning is that credit conditions are tightening up like a snare drum right now. ... the Fed reluctantly / felt forced to let interest rates actually put a nominal cost on money, and the result is that banks are now failing because of the residual cost of the imbalances of the last decade +. That has put a halt on commercial and corporate lending at least, and with mortgage and car loan payments now double to triple what they were when the Fed was keeping it's thumb on the scales of finance, that party has been abruptly broken up.

But it's almost like 1) consumers are sensing this is their last chance to max out their credit cards before the lights go out, 2) or the banks are desperate to load up the hapless with as much debt as possible, despite the fact that unless the Fed pivots and chooses runaway inflation over a credit bust (what everyone has been conditioned to assume will happen), the charge offs are going to bury even more banks.

 

The only reason I ever see The Guardian is because of all the links from it that have been posted on here, and I usually roll my eyes at the same tired prescriptions for how to steal from and coerce people in the name of centrally planning things, in ways that always end up f-ing up those things even more.

But for pure stupidity, I give you one of the dumbest headlines you will ever come across (putting aside that the content is more of the same).

For housing to be affordable, prices must go down, not up. Here’s how it could happen | Matt Grudnoff

 

Unfortunately the people who would really benefit from just listening to this are the ones I am certain won't. But it is a speech Stan Druckenmiller made at the annual meeting of the USC Marshall Center for Investment Studies last week.

For me, he is just pointing out the obvious. Things that have been staring us in the face, even as people deliberately allow themselves to live in delusion. It's important, because we are squandering time, and have been for the last decade and a half, and the stupid course we have taken has just made what is coming worse.

The speech itself is just the first 20 minutes or so of the link, unfortunately there is no video so you can't see the graphs. But it's well worth listening to. The realities he is pointing out are of such importance to younger generations' futures.