Consumers in Record Debt
In a recent report, it has been determined that consumers - American consumers, that is - are in more debt than they’ve ever been in. But they’re not borrowing simply to buy items that they shouldn’t be - they’re borrowing to dig themselves out of other debts, which is actually worse and signifies a growing problem here for our economy.
Economists say this is the first time in recorded history that consumers have been in this much debt. Americans actually owe more debt to financial institutions than they actually make per year. Household debt now exceeds household income by an mean average of about 8% - that is just plain scary.
The American middle class is suffering the most, with wages not growing, and the job market stagnating, as well as the skyrocketing cost of living outpacing the raises people receive from their employers.
Experts say that it’s only going to get worse too, since interest rate levels are at a historically good all time low right now too, which means our debt levels should subside, but they have not.
They also say that this shift is due to the rising energy and gas prices, as well as a stagnant hiring and job market, with little advancement in pay, since companies themselves are struggling to make ends meet as well. It’s all a domino effect, and major reform will be needed in all sectors in order to get our economy, and consumer debt, back in check and healthy again.
