CNBC: 28% of credit card users are still paying off last year’s holiday debt

It works out to about 1-in-5 American households
(and the average rate is 22.76%)

how does that jive with the projected GDP growth of 2.5% for the just completed 3rd quarter?

people are still spending money.

Allan

Allan

Well one possibility is that people believe their leaders and their leaders are (lying to them) saying “Everything is great! Now get out and spend, spend spend!”

On this forum I can’t resist mentioning that possibility.
.
.
.
More likely, the spending levels are K-shaped.
Your aggregate numbers look good because the top is doing very very well,
but when we disaggregate we see the bottom 50% is hurting more than usual.

For households $0-60k spending is not up. It is flat since 2023, in fact flat since pandemic. (Zero growth in 4 years, but mounting credit card debt. Pretty bad, huh?)

SOURCE:

credit cards don’t base your credit limit on 5 zillion times your income level

somehow the federal government does

so the upper crust hasnt changed its spending habits, but the lower crust has.

obviously since PCE is up.

Allan

1 Like

Is the PCE increase being driven by demand, or by inflated current prices. Are we spending more and getting more, or are we spending more and receiving less in return for that spending.

is adjusted for inflation. its a real increase in personal spending in the 3q2024.

Allan

Adjusted for inflation,
Households making $0-60k are spending exactly the same as 2022 and exactly the same as pre-pandemic.

100% of spending growth is coming from families making more than that.

The reality is that when it comes to spending money all to many people are completely irresponsible and simply rack up credit card debt. So not only is our economy and GDP built on government debt but also consumer debt.

1 Like

Hard to believe that it is an increase of anything more than increased costs. It definitely isn’t across all economic demographics. Defaults are up, disposable income is down for the lower and middle income portion of the population.

the facts however are there. people are spending more money as @gaius has pointed out however not increasing among the poor.

Allan

Good!
You’re getting it, but “not increasing” includes all households making $60k a year or less, which is approximately half of all households.

NOTE: it works out to $30/hour.

median household income for the united states in 2023 was $80,000
not 60,000.

so its less than half.

Allan

1 Like

You just can’t be that deluded about that you are saying. Might as well be telling the lower income to eat cake.

poor people spending was flat inflation adjusted.

no more no less.

the growth came from the high income people who made oodles of cash in the market. people who own stock are spending more money.
people who dont arent

Allan

poor people need to pull themselves up by the bootstraps.

Allan

You Democrats need to stop pushing them back down.

Now you’re getting it.
Now you’re focusing the truthful message.

Meanwhile . . . guess how the lower end (households under $65k comboned income) are still spending as flat-much as they used to? (hint in the thred title)

.
.
.
The good news is this is deliberate and can be halted if saner people get in charge.
It is deliberate policy to lower rates etc. in order to keep consumer spending high/
(You know, because people maxing out their credit cards to get the same amount of stuff is a good thing.)

have an idea. get funding. and start your own business. buy stock in companies.

there are tons of ways to make it in America.

Allan