US Debt and Consumer debt hit records

Americans are diving deeper and deeper into the red.

As of this month, outstanding consumer debt exceeded $4 trillion for the first time, according to the Federal Reserve.

Relatively strong holiday spending, particularly in November, and increasing credit card debt added more than $41 billion in outstanding balances at the end of 2018, according to LendingTree, a loan comparison website, which analyzed the data from the Fed.

In addition, a steady rise in student loan balances, as well as an increase in the cost of automobile financing in the fourth quarter, contributed another $80 billion.

https://www.cnbc.com/2019/02/21/cons...-trillion.html


WASHINGTON - More massive than the US economy, the national debt hit a new record of $22 trillion under President Donald Trump but Republicans who traditionally rail against debt and deficits have remained mum.

The sum of borrowing to cover chronic deficits as well as growing interest payments, this mountain of debt already stood at $19.95 trillion when Trump entered the White House, reaching the equivalent of US GDP for the first time since World War II.

By comparison, France's debt, which also is about the same as its GDP, amounted to a little more than 2.3 trillion euros (about $2.6 trillion) in late September.

The massive corporate tax cuts that Trump pushed for at the end of 2017, and the surge in spending, especially in defense, have increased the fiscal deficit for the world's largest economy.

"If we don't have a strong military, you don't have to worry about debt, you have bigger problems," Trump told reporters last week.

Administration officials continue to argue that the tax cuts, which are expected to widen the deficit by $1.5 trillion over 10 years, will pay for themselves by boosting economic growth and thereby increasing tax revenues.

But despite faster growth, the budget deficit climbed 17 percent to $779 billion last year, the worst since 2012. And according to the non-partisan Congressional Budget Office (CBO), the deficit is expected to widen further this year to $900 billion.

https://news.abs-cbn.com/overseas/02...epublicans-mum

Nothing wrong with debt in itself, only a problem when you can't afford to service it. The joys of being able to create money out of thin air and print as much as you like.

Yeah, didn't work so well last time, did it?

Another bubble waiting to burst.

debt is good, always been

it's when you are forced to repay debt that things go wrong

morale of the story, go for more debt

Quote:

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Originally Posted by Dragonfly

go for more debt

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To pay off your debts.
www.youtube.com/watch?v=g8DMsvviyeU

Quite sad really as it's all on the backs of those in debt of course.
Meanwhile the US stock market is up 19% since the big fall in December two and a half months ago.

That imo was just another years end pump and dump to take profits and jump back in on a low note.

Now might be another stepping off point but with the trade deal looming I just can't jump ship yet.

Plenty out there in the hold cash and gold boat right now but what fun is that.

Go for more debt? Good advice, max out all credit cards at once via cash withdrawals and run to another place you can't afford to live in. Sounds adventurous.

I am being a bit sarcastic and I do get your point. It takes debt and a track record of consistently paying it off to get good credit. Hovever that's not what is happening for those barely getting by.

Inflation outpacing wage growth eats away at that theory.

Couple that with easy money policies and it's another bubble waiting to burst.

It's been over seven years since the housing crash so I'd venture to say that many of those that lost their homes and went bankrupt have built up some form of credit again. We'll have to wait and see where that gets them.

Are you off the beer fishy? You're almost making sense.

Yes sir. I went cold turkey a few weeks ago thank you very much. I needed a vacation from my last vacation.

I know I don't allways make sense but I'm really good with the dollars part of the equation.
I was up 15 yesterday. Not bad for one day.That may well have been a personal best for me so far.

But alas it's all an illusion for what goes up must come down.

The magic of banking by Godfrey Bloom is a good read if interested.

^Magic for the few, bad juju for the many...

Quote:

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Originally Posted by fishlocker

I know I don't allways make sense but I'm really good with the dollars part of the equation.

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How many $ you pumped into Laos land / property mate?

I stopped keeping track Jack. It's not really that important to me at this point. Besides it's only mine when the well pump craps out or something. I did put a new one in a month or so ago at the farmhouse so I should be good for a while. I picked it out myself this time and it was under 150 bucks because I bought a bunch of other stuff from these folks.The GF says it was under 100. I pitched the receipt when I got back home so that's that.

I am thinking about picking up the woodland that borders the northern piece of the farm that we bought from the neighbors father in 2004. Bil mentioned the owner was looking to sell but didn't know of a price. I've yet to hear of the price as they may need money more than I need that land. I haven't enquired since I've been away. It hasn't the views of the farm but if and when they build a proper road the value will surely increase. The real question is do I need it, no. Do I really want it, no. would it be a worthwhile investment over time, maybe.

To put things in perspective, if a person decided pay down the national debt by paying 1 million dollars every hour 24 hrs a day it would take him/her 9,042 to pay the 22 trillion dollars owed, this does not take into consideration interest accrued during this 9.042 years.

US Debt - don't care, I'll be dead long before the bill comes due - glad I'm not one of them Millennials.

https://www.thebalance.com/who-owns-...l-debt-3306124

However, US Debt; a good portion (@$6T) of it is the US Government owing money to itself. The so called "Foreign Debt" (@$6T), owed to foreign countries is "artificial". What happens if the US doesn't pay? Actually an easy debt to clean up by charging more for our exports and paying less for our imports. Key phrase here is "Trade Imbalance".

Consumer debt - of a greater concern (not to me, I don't owe a cent), but to the undisciplined consumers who finance "stuff". You know the old saying - "the rich get richer, the poor get poorer". The mechanism is the rich who have money lend it to the poor who don't have money. The poor mortgage their future away. Paying 20-30% more using good old consumer financing - aka credit cards. Not to mention secured debt, mortgages and auto loans.

Problem with consumer debt is you have to pay it back. The USA has turned into a country of "consumption" using free money "credit cards". The financial trap only the smarter amongst us sidestep. After all, why drive a Buick when you can finance a Cadillac? Remember, "no money down, first payment free". Seven years later when you've paid it off you can still sell it for 10% of its purchase price. Maybe 3% of what you paid for it over time.

How comforting that we are more concerned about the starving people in Venezuela, NKorea, Cuba, you name it...

I believe the op was pointing out that the feds easy money policy coupled with the people's desire to often needlessly consume has led to debt like nothing ever seen before.

Those poor starving folks you mention, well frankly, they don't have a choice.

Govs get away with it by printing or borrowing, while we suckers have to dig deeper. Good thing about Thailand is nobody trusts you so zero debt and what you have is yours.