US Credit Card Debt Balloons to $917B: What It Means

by Alex Johnson 0

Are U.S. consumers displaying renewed confidence in the economy or returning to bad credit habits? Market observers seem to be somewhat divided on what our ballooning national credit card debt means:

Last year, credit card debt in the U.S. surged by approximately $71 billion to $917.7 billion, according to a new study from The research also found that most of the debt accrued in 2015 came in the fourth quarter, when Americans tacked on more than $52 billion.

“With 7 of the past 10 quarters reflecting year-over-year regression in consumer performance, evidence is mounting to support the notion that credit card users are reverting to pre-downturn bad habits,” CardHub CEO Odysseas Papadimitriou said in a statement.

David Santschi, CEO of TrimTabs Investment Research, said “it’s usually a good sign when … credit card debt is rising” because it usually means consumers are spending more money.

However, Steve Blitz, chief economist at ITG Investment Research, said this increase is “just a signal that there’s more people working,” adding that consumers are not necessarily taking on more debt.

“The willingness of an individual to increase their leverage is the ultimate vote of confidence in the economy,” he said.

Overview by Alex Johnson, Director, Credit Advisory Service at Mercator Advisory Group

Read the full story here

Featured Content