Households Are Borrowing More to Fuel Spending, Wells Fargo Says

[gdale6]

• Savings rates are falling, debt-to-income ratios are rising
• Americans appear confident even amid slow wage growth

U.S. households may be borrowing more to fuel their spending as wages grow slowly, according to Wells Fargo & Co.

Consumer spending may be rising because Americans are growing more confident, analysts John McElravey and Ryan Brinkoetter wrote in a presentation to clients Monday. Savings rates are falling, and a measure of debt levels has been edging higher relative to income recently after plunging in the years following the crisis.

https://www.bloomberg.com/news/articles/2018-02-12/households-are-borrowing-more-to-fuel-spending-we...

[Anonymous]

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wrote:

• Savings rates are falling, debt-to-income ratios are rising
• Americans appear confident even amid slow wage growth

U.S. households may be borrowing more to fuel their spending as wages grow slowly, according to Wells Fargo & Co.

Consumer spending may be rising because Americans are growing more confident, analysts John McElravey and Ryan Brinkoetter wrote in a presentation to clients Monday. Savings rates are falling, and a measure of debt levels has been edging higher relative to income recently after plunging in the years following the crisis.

https://www.bloomberg.com/news/articles/2018-02-12/households-are-borrowing-more-to-fuel-spending-we...

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Same ole same ole... people will never learn. Bubbles will form again.

[fuzzle]

People learned that it's OK to default on their loans, and lenders learned that they will get bailed out

[Anonymous]

Total household average debt is $100,000 including mortgage and total household income average is $80,000, so total debt is 1.25 income?

No news here, just fearmongering as usual.

While I would never go this deep into debt except for appreciating business assets, it doesn't seem all that bad to me.  If the number of folks getting mortgages 4.5X income rises, then I'll be worried.

[Kree]

My student loan debt alone is like 2x my income.  But it is PAYE so I pay 0 a month.  (likely to go up to 166 soon)

[CreditCuriosity]

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@Anonymouswrote:

Total household average debt is $100,000 including mortgage and total household income average is $80,000, so total debt is 1.25 income?

No news here, just fearmongering as usual.

While I would never go this deep into debt except for appreciating business assets, it doesn't seem all that bad to me.  If the number of folks getting mortgages 4.5X income rises, then I'll be worried.

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Where are you getting household average income is 80k.. thought it was approx 60k?  Source please

IMO credit card debt is getting up near where it was in 2008 where the crud hit the fan granted the housing market aka lenders actually verify income/employment/etc vs. what they did prior to 2008 although it is scary that CC debt is approaching the 2008 level again.

[Anonymous]

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@CreditCuriositywrote:

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@Anonymouswrote:

Total household average debt is $100,000 including mortgage and total household income average is $80,000, so total debt is 1.25 income?

No news here, just fearmongering as usual.

While I would never go this deep into debt except for appreciating business assets, it doesn't seem all that bad to me.  If the number of folks getting mortgages 4.5X income rises, then I'll be worried.

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Where are you getting household average income is 80k.. thought it was approx 60k?  Source please

IMO credit card debt is getting up near where it was in 2008 where the crud hit the fan granted the housing market aka lenders actually verify income/employment/etc vs. what they did prior to 2008 although it is scary that CC debt is approaching the 2008 level again.

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Agreed - and the "consumer confidence" thing (parroted as of late) may just be all smoke-and-mirrors.

[Anonymous]

At some point , 2008/2009 will be repeat. Part of the business cycle. Stocks are expensive and forget bonds.