How do these Trends Affect your Business?

Jim’s View


Total household debt surpassed the peak reached during the 2008 Great Recession in the first quarter of this year. It reached $12.73 trillion in the last quarter compared to its $12.68 trillion peak during the recession.

Mortgages increased somewhat. Auto loans increased $10 billion and student loans increased $34 billion.  Credit card balances declined by $15 billion to $764 billion.

Overall the first quarter marked a $149 billion quarterly increase and reflects a nearly three-year continued growth in debt.  

Auto loans and credit card delinquency flows are now trending upwards and those for student loans remain stubbornly high.   Outstanding student loan balances reached $1.34 trillion as of March 31, 2017.  The Fed says there is delinquency debt of 11% over 90 days…..but don’t believe it.  The way the Fed calculates, it leaves off a sizeable portion of delinquent student loan debt in their reporting.

Auto loan delinquency rates first quarter…3.8 %

Credit card delinquencies….7.5 %

Mortgage delinquencies continued to improve, but the bar was surely low with all the mortgage walk-aways and slow or no pay on mortgages during the Great Recession.