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Going Down the Path of Consumer Debt - Again

Started by washingtonindependent · 7 months ago

At creditslips.org, Bob Lawless raises the most reasonable question I’ve seen so far about Treasury Secretary Henry Paulson’s decision to shift the focus of the government bailout plan to consumers. In an attempt to get credit flowing again, Paulson wants to try to increa ... Continue reading »

8 comments

  • JohnMcDonald

    7 months ago

    Credit has to slow, interest rates have to go up. I don't want to pretend that this is going to be painless, but we've reached a sort of peak credit point where the benefits of new debt can't possibly compare to what those benefits were when the total debt load was lower (say, the 70s).

    Debt spiked prior to the Great Depression in a similar pattern to the early 2000s, and ultimately that's what caused the discomfort of the era. People had to stop borrowing and start living within their means with an eye on paying down principle owed.

    If we take a deep breath and a sober look at the bills, we can start to build a foundation for a stronger tomorrow. If we ignore reality and borrow every penny we possibly can? Well, at some point (probably soon) we'll reach a limit where no one wants to lend to us anymore. Its the same endgame - there's not much borrowing left we can do before paying something back. The sooner the macro trend moves toward repayment, the sooner we'll see a real recovery...
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  • JonathanBrowne

    5 months ago

    It's absolutely far too dangerous for America to continue putting everything on credit.
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  • Deepak

    5 months ago

    (MarketWatch) - U.S. consumers reduced their debt load by a record amount in August, the Federal Reserve reported Tuesday. Total seasonally adjusted consumer debt dropped by $7.9 billion, or a 3.7% annual rate, in August to $2.58 trillion. This was the first decline since January 1998. Consumer credit rose 2.4% in July. Non-revolving credit - such as auto loans, personal loans and student loans - dropped sharply by $7.3 billion, or 5.4%, to $1.61 trillion, after rising 0.9% in July. Credit-card debt dropped by $612 million, or 0.8%, in August to $969 billion.
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  • can collection agency sue?

    4 months ago

    nice post.this is what i was searching for.kudos to you.
    reply
  • Debt_free

    3 months ago

    interesting survey, thank's
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  • Web Designer

    3 months ago

    Yeah today everyone relies on credit and doesn't think twice about the consequences.
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  • girls like me

    1 month ago

    Yeah I agree to Jonathan Browne it is really dangerous for America to continue putting everything on credit. Because our economy will fall, most credit users don't pay much that's why we are experiencing financial crisis nowadays. I don't think auto loans will work because GM aren't in a good situation.
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  • vw parts

    3 weeks ago

    Citigroup shouldn't raise interest rates on credit cards because people nowadays are experiencing financial problem.
    "As a nation, we now over $13 trillion on our credit cards, automobile loans, and home mortgages." --- And regarding auto loans I think it will not work nowadays because who has the money to have one with this kind of crisis?
    reply

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