@CreditCuriosity wrote:
@Anonymalous wrote:
While that's a flashy, symbolic milestone, I don't think it's particularly notable. CC debt and default rates were suppressed during the pandemic, and when adjusted for inflation, this is mostly just a return to normal levels.
That's not to say everything's rosy, just that this metric isn't screaming doom.
Big troubles ahead and BK will hit all time highs imo especially come OCT when repayment of student loan is forced and people have to choose between essentials as can't get out of SL payments anymore and a lot of people got use to spending SL money on other things hoping it was going to go away or whatever other rational they used and racked up CC debt and now SL $ is being allocated to pay that. Certainly some assumptions being made here, but see a perfect storm comig for a lot of defaults
I agree, but that's not addressed by this particular metric. The current level of credit card debt isn't particularly worrisome on its own. Even the rising rate of defaults isn't that big a deal without additional context, because both are mostly just a normalization to pre-pandemic levels. Though there are definitely a lot of things to worry about, including the resumption of student loan payments you mentioned, but also persistent inflation, wages falling behind expenses, the state of the housing market, the bubble of everything, the inverted yield curve and several dozen other recession indicators, national debts and unfunded liabilities, the BRICs creating their own currency and other threats to the dollar, various wars and threatened wars, Europe's negative GDP, AI, and so on. Specifically related to CC debt, I think the rise in people using credit card debt to cover essentials is more relevant than the aggregate number.
