After The Party... The Hangover: The State Of America's Debt Slaves | Zero Hedge
Description: That 5.1% year-over-year increase isn’t setting any records – in 2011, year-over-year increases ran over 11%. But it does show that Americans are dealing with the economy and their joys and woes the American way: by piling on debt faster than the overall economy is growing.

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## The Next Rally In Gold

by Sprott Money - May 9, 2018 7:00 am

The past four weeks have seen a relentless rally in the U.S. dollar as the Dollar Index has soared by nearly 4%.

## The Mortgage Industry is Evolving-Finally

by financedude85 - May 9, 2018 9:47 am

The Ten-Year United States Treasury Bond closed Friday, April 19th with a yield of 2.951%. That is the highest yield and the lowest price since the last day of 2013 when it closed at 3.026%.

## Warning: Fed Tightening Won't Accomplish a Thing, Inflation is Coming

by Phoenix Capita… - May 9, 2018 9:28 am

This one chart shows it all.

# After The Party... The Hangover: The State Of America's Debt Slaves

Authored by Wolf Richter via WolfStreet.com,

After the party, the hangover.

Total consumer credit rose 5.1% in the first quarter, compared to a year earlier, or by $184 billion, to $3.824 trillion (not seasonally adjusted), according to the Federal Reserve. This includes credit-card debt, auto loans, and student loans, but not mortgage-related debt. That 5.1% year-over-year increase isn’t setting any records – in 2011, year-over-year increases ran over 11%. But it does show that Americans are dealing with the economy and their joys and woes the American way: by piling on debt faster than the overall economy is growing.

The chart below shows the progression of consumer debt since 2006. In line with seasonal patterns for first quarters, consumer credit (not seasonally adjusted) edged down from Q4, as the spending binge of the holiday shopping season turned into hangover, an annual American ritual:

Note how the dip after the Financial Crisis – when consumers deleveraged mostly by defaulting on those debts – didn’t last long. Over the 10 years since Q1 2008, consumer debt has now surged 47%. Over the same period, the consumer price index has increased 16.9%:

Auto loans and leases for new and used vehicles rose by 3.8% from a year ago, or by $41 billion, to $1.118 trillion.

It was one of the smaller increases since the Great Recession: The peak year-over-year jumps occurred at the peak of the new vehicle sales boom in the US in Q3 2015 ($87 billion or 9%). However, the still standing records were set in Q1 and Q2 2001 near the end of the recession, with each quarter adding around $93 billion, or 16%, year-over-year.

Loan balances are impacted by prices of vehicles, number of vehicles financed, the average loan-to-value ratio, duration of prior loans (when they’re paid off), and other factors. So this chart is not necessarily a reflection of how many new and used vehicles were sold.

The green line in the chart indicates the old data. In September 2017, the Federal Reserve implemented a big adjustment of consumer credit data going back through Q4 2015. This adjustment was based on survey data collected every five years. So routine. The adjustments hit auto-loan balances disproportionately, knocking them down by $38 billion retroactively for Q4 2015. To show the distortive effect of the adjustment – and to show that it wasn’t the collapse of the car business – I added the old data in green.

Credit card debt and other revolving credit in Q1 rose 5% year-over-year (not seasonally adjusted) to $977 billion. This growth rate was down from the 5.6%-6.8% Trump-bump increases that started in Q4 2016 and ran through Q4 2017. So it was somewhat of a disappointment for those wanting to see consumers drown in high-cost (or high-profit) debt.

On a quarterly basis, and in line with seasonal patterns, revolving credit card balances fell by $52 billion from the shopping season debt-pile up in Q4, as the annual hangover began. In dollar terms it was the steepest Q4-Q1 plunge since Q1 2010. In percentage terms (-5.1%), it was the steeped since Q1 2012.

But wait… Q4 credit card balances of $1.03 trillion had been an all-time record, finally beating the record of Q4 2008. And Q1 2018, at $977 billion, set a record for any first quarter, beating Q1 2008 by a smidgen ($973 billion). So Americans did their job piling on high-profit debt.

Student loans in Q1 jumped by 5.4% ($77.8 billion) year-over-year to $1.51 trillion. While a shocking increase, it was the slowest year-over-year percent increase going back to 2007, the beginning of the data series: In fact, between 2007 and Q3 2012, these year-over-year increases ranged from 11% to 15%!

But it’s not like more people are going to college. Higher-education enrollment had peaked in 2010 and declined at least through 2015, according to the last data available from the National Center for Education Statistics. And yet, over the 10 years from Q1 2008 to Q1 2018, student loan balances soared by 146%, from $619 billion to $1.521 trillion. Over the same period, the consumer price index rose 16.9%.

Students added $902 billion to their debts over the past 10 years — a debt that will dog them for decades to come. And for most of this debt, taxpayers are on the hook. But who obtained the money?

A whole economy has sprung up around this bonanza, with entire industries getting fat: Investors in private colleges; the student housing industry, which has become an asset class within commercial real estate; companies like Apple that supply students with whatever it takes; the textbook industry; overpaid top administrators; construction companies and affiliated industries building university-owned projects, from mega-stadiums to glitzy administrative buildings; Wall Street by making it all possible; and many more. But hey, that’s how you get GDP and corporate profits to grow. It’s a dirty job, but someone’s got to do it.

This is the brick & mortar part of e-commerce. Read… As Malls Melt Down, Industrial Properties Heat Up

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## Comments

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JibjeResearch Wed, 05/09/2018 - 11:54 Permalink

Get these coins baitchezzzz.... if you have not done so :)

BTC, BCH, BTG, BCD, BCA, LTC, LCC, ETH and/or any of the top 10 coins.

Just don't get a centralized coin!

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Bitchface-KILLAH JibjeResearch Wed, 05/09/2018 - 11:58 Permalink

That's right... crypto has no counter-party reliability and is no fool's slave. Also, crypto has a long history of being accepted as money by olde time gamers and trolls.

In reply to Get these coins baitchezzzz… by JibjeResearch

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Ace006 Bitchface-KILLAH Wed, 05/09/2018 - 12:34 Permalink

Well, if gamers and trolls accept crypto LET ME IN on the action!!

In reply to That's right... by Bitchface-KILLAH

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Bitchface-KILLAH Ace006 Wed, 05/09/2018 - 12:40 Permalink

I have a very different perspective on "trolls" and "hackers". These are teh people that stop the world wide web from becoming another pay-for television channel and keep things interesting. We should be extremely thankful for the services they provide keeping the Internet a chaotic, hateful and dangerous place.

In reply to Well, if gamers and trolls… by Ace006

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Oldguy05 JibjeResearch Wed, 05/09/2018 - 12:07 Permalink

So..No target or Overstock coins?

In reply to Get these coins baitchezzzz… by JibjeResearch

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Bitchface-KILLAH Oldguy05 Wed, 05/09/2018 - 12:13 Permalink

I avoid any TOKENS that claim to have a specific use. Porn sites, hardware stores, massage therapists, lectors do not need their own CURRENCY...

In reply to So..No target or Overstock… by Oldguy05

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SkullCramp JibjeResearch Wed, 05/09/2018 - 12:26 Permalink

Just go to Coinbase and purchase bitcoin, they have an exchange ( GDAX ) to trade back for USD . Set you high and low sell markers and make a few bucks while the world is learning what block chain is, and how they are going to keep it decentralized and away from the central banks control.

In reply to Get these coins baitchezzzz… by JibjeResearch

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gogobuffalo Wed, 05/09/2018 - 11:54 Permalink

Debt slavery caused from capitalistic exploitation of the labor class and minorities.

With the initiatives for guaranteed jobs for everyone, money will trickle up, instead of down, and debt will be paid down at a record pace. Jobs will be created through the new surge in consumer spending, and another Obama-esque expansion will begin. The same one Trump is trying to take credit for now.

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truthseeker69 gogobuffalo Wed, 05/09/2018 - 12:00 Permalink

> Debt slavery caused from capitalistic exploitation of the labor class and minorities.

Right, government-run economy is now Capitalism. Read some Rothbard, before making inane comments.

In reply to Debt slavery caused from… by gogobuffalo

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gogobuffalo truthseeker69 Wed, 05/09/2018 - 12:02 Permalink

Read some Keynes and Marx before spouting your nonsense.

In reply to Debt slavery caused from… by truthseeker69

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Bitchface-KILLAH gogobuffalo Wed, 05/09/2018 - 12:14 Permalink

Sounds like you picked teh wrong website.

In reply to Read some Keynes and Marx… by gogobuffalo

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gogobuffalo Bitchface-KILLAH Wed, 05/09/2018 - 12:16 Permalink

the*

In reply to Sounds like you picked teh… by Bitchface-KILLAH

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Bitchface-KILLAH gogobuffalo Wed, 05/09/2018 - 12:18 Permalink

teh

In reply to the* by gogobuffalo

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JibjeResearch Bitchface-KILLAH Wed, 05/09/2018 - 12:39 Permalink

lolz ahahahaha ....

In reply to teh by Bitchface-KILLAH

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RabbitOne gogobuffalo Wed, 05/09/2018 - 12:40 Permalink

In Chinese ....Ahhhhhhhhhh Sooooooooooooo!

In reply to the* by gogobuffalo

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falconflight gogobuffalo Wed, 05/09/2018 - 12:20 Permalink

Yes, Keynes and Marx were if anything, promoting the virtues of free enterprise and not promoting government dictatorship of all things economic...

In reply to Read some Keynes and Marx… by gogobuffalo

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factorypreset gogobuffalo Wed, 05/09/2018 - 12:44 Permalink

Keynes, Mises, Rothbard, Marx, etc ... hahaha ...

In reply to Read some Keynes and Marx… by gogobuffalo

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sabaj49 gogobuffalo Wed, 05/09/2018 - 12:06 Permalink

gogobuffalo - if you only had a brain

In reply to Debt slavery caused from… by gogobuffalo

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gogobuffalo sabaj49 Wed, 05/09/2018 - 12:16 Permalink

So you're opposed to economic and social justice?

In reply to gogobuffalo - if you only… by sabaj49

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Bitchface-KILLAH gogobuffalo Wed, 05/09/2018 - 12:19 Permalink

"social justice" == left wing fantasy revenge porn.

In reply to So you're opposed to… by gogobuffalo

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ILoveGooold gogobuffalo Wed, 05/09/2018 - 12:19 Permalink

Nah just half-baked theories that have failed every time they've been attempted leading to levels of poverty and death never before seen in human history. Ya know... things like that. You goddamn moron.

In reply to So you're opposed to… by gogobuffalo

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Ace006 gogobuffalo Wed, 05/09/2018 - 12:40 Permalink

1. Beat breast about economic and social justice.

2. ??

3. Profits.

In reply to So you're opposed to… by gogobuffalo

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Timmay gogobuffalo Wed, 05/09/2018 - 12:06 Permalink

Guaranteed jobs equals shit quality which will spark true free market labor pricing again......just before the robots take over.

In reply to Debt slavery caused from… by gogobuffalo

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gogobuffalo Timmay Wed, 05/09/2018 - 12:22 Permalink

When people are given work with dignity - versus slave wages - their productivity rockets up.

Quality will leap forward when we guarantee every American the right to a good paying job and a living wage!

In reply to Guaranteed jobs equals shit… by Timmay

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DennisAOK gogobuffalo Wed, 05/09/2018 - 12:35 Permalink

When they are "given" jobs? By whom? And why will people work to produce high quality goods when they are already guaranteed a well-paying job? Ever think about that? Sorry you find work so distasteful, but I have no obligation to support you.

In reply to When people are given work… by gogobuffalo

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BigWillyStyle887 gogobuffalo Wed, 05/09/2018 - 12:10 Permalink

Guaranteed jobs for everyone, that was tried in the soviet union wasnt it?

In reply to Debt slavery caused from… by gogobuffalo

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gogobuffalo BigWillyStyle887 Wed, 05/09/2018 - 12:25 Permalink

It hasn't been tried the right way yet.

In reply to Guaranteed jobs for everyone… by BigWillyStyle887

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Wild Bill Steamcock gogobuffalo Wed, 05/09/2018 - 12:11 Permalink

"exploitation of the labor class and minorities" -This guy is saying colored people don't work. Hahahahahahahhahahhahaha!!! Fucking progressives and leftists, man, the most racist people out there, but too dumb to own it

In reply to Debt slavery caused from… by gogobuffalo

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gogobuffalo Wild Bill Steamcock Wed, 05/09/2018 - 12:20 Permalink

It's racist to support minorities?

Geez you live in an upside down world.

Let me guess, you support immigration enforcement as well? Love doesn't build walls it tears them down.

In reply to "exploitation of the labor… by Wild Bill Steamcock

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Bitchface-KILLAH gogobuffalo Wed, 05/09/2018 - 12:25 Permalink

Love protects family members from mudslime terrorists and wetback border hoppers.

In reply to It's racist to support… by gogobuffalo

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gogobuffalo Bitchface-KILLAH Wed, 05/09/2018 - 12:26 Permalink

And the best form of protection is by offering our best jobs to our undocumented citizens. When economic justice is realized, there will be no reason for crime or terrorism. These people are crying for help when they lash out like that.

In reply to Love protects family members… by Bitchface-KILLAH

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Bitchface-KILLAH gogobuffalo Wed, 05/09/2018 - 12:30 Permalink

Bullcrap. You people think that everything bad is simply the result of environmental determinism. No... there really are fucked up, evil people out there, who will be out there in good times and bad.

In reply to And the best form of… by gogobuffalo

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Wild Bill Steamcock gogobuffalo Wed, 05/09/2018 - 12:31 Permalink

LOL. I can't take seriously any of that shit you just said. Pretty good trolling effort

In reply to It's racist to support… by gogobuffalo

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DennisAOK Wild Bill Steamcock Wed, 05/09/2018 - 12:36 Permalink

Nor should you.

In reply to LOL. I can't take seriously… by Wild Bill Steamcock

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Wild Bill Steamcock DennisAOK Wed, 05/09/2018 - 12:41 Permalink

Reading all of the posts, it's clear what he's doing. I'll tip my hat to the effort

In reply to Nor should you. by DennisAOK

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Wild Bill Steamcock DennisAOK Wed, 05/09/2018 - 12:41 Permalink

double post

In reply to Nor should you. by DennisAOK

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E.F. Mutton gogobuffalo Wed, 05/09/2018 - 12:16 Permalink

Awesome Marx imitation Dude, you should go on X Factor.

In reply to Debt slavery caused from… by gogobuffalo

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gogobuffalo E.F. Mutton Wed, 05/09/2018 - 12:23 Permalink

Thanks!

In reply to Awesome Marx imitation Dude,… by E.F. Mutton

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gogobuffalo gogobuffalo Wed, 05/09/2018 - 12:19 Permalink

I like how nobody has been able to counter my assertion that guaranteed jobs will create a surge of economic growth and productivity.

Capitalists are allergic to facts.

In reply to Debt slavery caused from… by gogobuffalo

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Bitchface-KILLAH gogobuffalo Wed, 05/09/2018 - 12:32 Permalink

guaranteed jobs == government positions == the result of infinite fiat currency == ie, shit I don't want to hold.

In reply to I like how nobody has been… by gogobuffalo

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Ace006 gogobuffalo Wed, 05/09/2018 - 12:37 Permalink

And who will play the Sugar Plum Fairy in this little morality play?

In reply to Debt slavery caused from… by gogobuffalo

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CFreez Wed, 05/09/2018 - 11:56 Permalink

Here is an interesting look at the relationship between financial stability, debt and the economic cycle:

http://viableopposition.blogspot.ca/2018/04/the-debt-cycle.html

It is becoming increasingly apparent that consumers learned absolutely nothing from the debt meltdown during and prior to the Great Recession.

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Kidbuck Wed, 05/09/2018 - 11:57 Permalink

I get this article right over an ad for some company called Lendvious that wants to lend me $50,000 for "high conviction trades to increase the margin on my margin." WTF?

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Oldguy05 Kidbuck Wed, 05/09/2018 - 12:05 Permalink

Reverse targeted advertising. They sure are wily money lenders:)

In reply to I get this article right… by Kidbuck

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Rex Andrus Kidbuck Wed, 05/09/2018 - 12:05 Permalink

It's a typo. S/B "high conviction traders". CBs outsourcing.

In reply to I get this article right… by Kidbuck

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Oldguy05 Wed, 05/09/2018 - 12:03 Permalink

Paid off my debt. Stacking PMs and cash... and other things I won't mention anymoar.

Probably won't mention PMs and cash now as well.

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Philo Beddoe Oldguy05 Wed, 05/09/2018 - 12:07 Permalink

Your PMs are safe. You could hide them on your front porch and the postman would kick them over to deliver your mail.

In reply to Paid off my debt. Stacking… by Oldguy05

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Oldguy05 Philo Beddoe Wed, 05/09/2018 - 12:12 Permalink

I brought in and offered people at work a 10oz silver bar for$10, $25 or $50 (I forget which). I would have let them buy it at that price but no one wanted to buy it. They were very surprised when I explained what it was worth. I opened some eyes that day.

In reply to Your PMs are safe. You could… by Philo Beddoe

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RafterManFMJ Oldguy05 Wed, 05/09/2018 - 12:17 Permalink

Found Mark Dice's account

In reply to I brought in and offered… by Oldguy05

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KimAsa Oldguy05 Wed, 05/09/2018 - 12:12 Permalink

Stack goods that you can use to barter later.

In reply to Paid off my debt. Stacking… by Oldguy05

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