2 Responses to “U.S. Consumer Credit: Deleveraging Continues, but…”
Rates are low, so the carrying cos of debt is quite a bit lower now than it was a few years ago.
The decline in mortgage debt is heavily driven by defaults and refinancing to lower rates with defaults being the biggest driver. Any increase in consumer debt will be an indication that the American people have decided that they don't have to save for retirement. However, without growth in consumer spending the economy will not grow and the median family income is not growing, Either real wage increases have to occur or the economy will stagnant. Increases in debt would only provide a short term solution to growth.