Credit Card Debit Not Coming From Keeping Up With the Jones’, but From Trying To Keep Up With Inflation Under Biden

0
66

When Americans are unable to afford a purchase at once they often resort to using their credit rating to help them make the purchase. A new car, house, college, or unexpected medical expenses all occur with many people relying on their credit and someone putting up the money for them to make things happen.

Daily expenses are a whole other story though.

Things like gas, bread, milk, and utility bills have been skyrocketing because of poor planning by the Biden administration as these companies attempt to recover from the losses suffered during COVID. Some industries are just trying to keep up with the shortages being felt globally due to the conflict in Ukraine.

The Gov’t’s Actions Have Gone Beyond Anything I Imagined!

Developing Story with Dr. Ron Paul Reveals #1 Step Every American Needs to Take. Find Out More

Find Out More

No matter how you slice it, the American people are having a hard time keeping up with inflation. With the APR on most credit cards not being much worse than inflation, charging day-to-day expenses just makes sense. When you can get a 0%APR card it makes even more sense. It also can make overcharging that much easier when it doesn’t reflect in your daily bank balance.

So when the NY Federal Reserve announced on August 2nd that credit card debt had ballooned up to $16 trillion in the second quarter, nobody was that surprised. What was a touch shocking though, is that this is the first time the debt level had reached that high.

Over the past quarter, Americans have racked up $46 billion in credit card debt. In the last calendar year that total goes up to $100 billion, or 13%. This marks the biggest percentage change in over 20 years. Considering how high the interest rates have gotten with some cards, it’s easy to see why. Given that this is charged when a card isn’t being paid in full, the jump in credit card balances makes much more sense.

With 233 million more credit card accounts being opened in the second quarter, it marked the biggest jump since 2008 according to the NY Fed report. People are also keeping up with them, as defaults are at historic lows, something the NY Fed contributes to a very strong job market.

“Although debt balances are growing rapidly, households, in general, have weathered the pandemic remarkably well…With the supportive policies of the pandemic mostly in the past, there are pockets of borrowers who are beginning to show some distress on their debt.”

These pockets are often in the lower-income and subprime mortgage markets. They have to find ways to make things stretch, and while many are good at it, this is not a perfect art and when the chips are down the credit cards can easily become the last things, that they worry about paying off. With moratoriums and forbearance programs in place, people have a far greater incentive to arrange an agreement than to miss the mark and end up having an impossible-to-pay balance.

President Biden had opportunities to prevent all of this. His failure to see how his leadership choices would impact the inflation rate, and how consumers would have to use their money is astonishing. Given his years in politics, he should have had at least a basic handle on the economy, and the man so far has barely had a handle on the walkway to Air Force One or his thought processes.

The Gov’t’s Actions Have Gone Beyond Anything I Imagined!

Developing Story with Dr. Ron Paul Reveals #1 Step Every American Needs to Take. Find Out More

Find Out More

LEAVE A REPLY

Please enter your comment!
Please enter your name here