Consumers Are All Right

Despite the alarmist headlines, the growth of the use of credit is trending downwards, and that could be due to rising rates (although most current debt consumers hold was financed at low rates before the Fed started hiking) and of course, things can't grow to the sky either.

The blue line shows credit card and revolving debt growth sharply slowing, and expressed a percentage of disposable income, we're "square on the nose" sitting at pre-pandemic levels.

So in percentage terms (not in nominal dollars) in the aggregate, consumers are keeping their debt obligations on a leash.

It is indeed unfortunate, for the sake of our national discourse and a well informed citizenry, that the news media cannot live without a new crisis every day. We're in good shape. Inflation is in retreat, jobs are plentiful, and for that, we should be grateful.

9/26/2023