Fed Reports Massive Spike In Defaults. Credit Card Meltdown
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- เผยแพร่เมื่อ 15 มิ.ย. 2024
- The Philadelphia Federal Reserve just released its Q4 Credit Card Report and the results are shocking. The fourth quarter of 2023 recorded the lowest performance in card metrics, with delinquencies at all account stages reaching unprecedented levels. The only exception was the 90+ day balance-based delinquency rate, which remained below its peak from over ten years ago. Looking throughout the report it's pretty easy to see that Americans are struggling with credit card debt with nearly all aspects of the report turning sour.
- ภาพยนตร์และแอนิเมชัน
My sympathy goes to anyone approaching retirement, you may have reasonable concerns over your pension and if it'll stretch to cover the rising cost of living, bad regulatory policies, bad energy and insane fiscal policies.
My condolences to anyone retiring in this crisis, 30 years nonstop just for a crooked system to take all you worked for.
No doubt being financially free and not having to worry much about health care and other expenses cannot be overemphasized, making smart plans and setting up diversified investment portfolios is quite essential.
Honestly this cannot be overemphasized, helping people mitigate unforseen circumstances and mistakes .It's always good to have a financial plan,
You need to get a financial planner to aid diversify your portfolio to commodities index funds, digital assets etc, to provide illumination and guidance in the financial markets.
Oh really ?! Tell me more!
They turn student loans back on and then are surprised when young people start defaulting on their debts. It's almost like they don't understand the economics of the common person aged 18-30.
They do understand, they just don't care.
18 TRILLION IN CONSUMER DEBT GOING TO 20 TRILLION BEFORE THE END OF THE YEAR ! Most of it will never be repaid !
It's not any government fault that people live above means.Thst robbing Peter to pay Paul has played out. Next stop tent city
We would not have a deficit if we taxed the wealthy
Don't feel bad, at least half of it is interest and fees.
And yet Americans keep falling for advertising convincing them they need things they really don't. Everyone should take a hard look at what expenses they can cut to get back on track. Many of the recurring expenses people pay for aren't actual needs but a wants, or at least the amount they pay for them is a want.
I do it too. We pay like $140 a month in cell phone bills for 2 phones, we could easily go with a budget cell provider and pay less than half of that, but we're addicted to our unlimited high speed data and flawless cell coverage, so we keep overpaying.
I am old enough to remember when the average person did not have a credit card. Credit cards (and student loans) has created a generation of serfs obligated to work forever to repay debts (because of interest) may never be repaid keeping them working until the day they die.
It is amazing how history is repeating from the 70s. This will be a fun ride, but unfortunately the strife will be real for generations to come.
And they entered their serfdom voluntarily.
Debt is a financial tool however, like any tool, if used incorrectly it can lead to serious repercussions. Incorrect use of debt and acquiring interest that isn't serviceable is the modern day equivalent of slavery.
i know a bunch of people who had jobs and after looking at their bills they took out 4 credit cards and quit. now they are just gonna max those cards and chill for a few years and they are saying "whats the justice system gonna do? send me to jail? they dont even send real criminals to jail." His logic is kind of on point
people are stupid and want it now... save and buy when u have cash!
Everyday is brutal waiting for this to start
Although you're right, it will start. There's no point living your life waiting for it. Look at The Big Short, they predicted it in 2006 and they messed around to delay it to 2008, even then they bailed it all out to keep it going.
Good video.. the market has been crazy lately, a few surprises here and there.. with all the global happenings taking place I think it’s safe to say that a severe global recession is looming..
Oh yeah! You can definitely say that, it does worry me a bit, but not as much as it would worry the average guy, my investment portfolio has survived a couple of recessions unscathed.
Been privileged to be guided under the stewardship of an extremely gifted investment manager by the name Eric Paul Elmer
indeed, most people downplay the roles of financial planners until burnt by there mistakes.
Productivity is optimized and keeping up to date strategies and analysis makes it more lucrative.
I've been able to navigate the volatilities and scaled up 880k from 220k with professional guidance.
Recently, I've been considering the possibility of speaking with consultants. I need guidance because I'm an adult, but I'm not sure if their services would be all that helpful.
You're not doing anything wrong; the problem is that you don't have the knowledge needed to succeed in a challenging market. Only highly qualified professionals who had to experience the 2008 financial crisis could hope to earn a high salary in these challenging conditions.
Until the debt market melts down, which it will, then it's game over
Yep.
Maybe in 2475
game over man! Movie quote, Aliens, Bill Paxton
@@davidcarp5935 stop your grinnin an drop your linen
Im so glad im debtfree! 🙏🏻
I am glad you are too. That's great. But also remember, every single taxpayer owes $267,000 at bare minimum, at this moment.
@@marcocarlson1693 I don't owe shit.
You won’t be when it’s all erased.
@@marcocarlson1693 More reason to work and get paid under the table. Why pay taxes when the government wastes it.
me too ! debt is for id10ts
Oh oh oh oh!!! I know how to fix this
Instead of reporting it every quarter, we report on it once every 10 years!!!
Remember. These same experts told us that stimulus money wouldn’t cause inflation in the long run :)
Let's do the math here. Unemployment is extremely low currently, but charge offs are going up. That means people who are employed are spending on credit cards to make ends meet. Sounds like a ticking time bomb to me.
When the US goes into a recession all hell will break loose. Be prepared.
If you believe the unemployment numbers are correct? What if it's all one big lie?
This all boils down to one word, education.
Hopefully this starts to reduce spending which will help reduce demand in products and will hopefully reduce inflation.
Unemployment will reduce inflation. Give it time.
This is anecdotal, but as someone who works at a bank, we have seen more loan returns since the start of this year than we did all of last year.
No defaults yet, but those take longer.
That means a loan paid back early ?
Please explain to me, HOW IS THIS A SUPRISE? If you teach people to borrow to survive at some point, when there is nothing left to borrow, they default.
... 'Surprise'? When did anyone say anything about a 'surprise'? This seems like a pretty much working as intended 'Maximize short term profits' mentality at its finest.
@@theravenone3439 Its like musical chairs.... "maximize short term profits", make sure you've cashed out, and aren't the one holding the bag when the music stops.
The only thing that avoids the collapse of the economy in the US is the record-breaking government budget deficit for periods outside of recession or outside of periods of recovery from recessions. In essence, the government is creating debt in the economy to turn it into capital for companies and individuals. Take that crutch away and everything goes downhill.
Thank you.
fun going back and watching the videos from 3 years ago
I can guarantee this chart would have looked identical in 2006-2007 right before that bubble popped. This bubble is 45% worse than that one. Buckle up.
Exactly what I was seeing- another "unprecedented" event in our time (I say this as a millennial).
$584 B in 2012 is $794 B in 2024 when adjusted for inflation. It's not quite as bad as the graph would suggest, but I still don't think there's good news here. It's just not quite as doom and gloom as a quick glance suggests
uh did u look at the graph? not only is it rising but its accelerating. this isnt normal
Good point, but I'd use the change in incomes instead of the inflation rate to get a better idea of how much pressure is on the average borrower then vs now.
Also, rates on cards back then were way lower. Average rate now is over 20%, makes the debt far more oppressive and sticky.
The interest rate is at like 20% good luck chipping away at 10 grand of debt wilt interest while paying for all other life’s expenses
@@napervillain Then don't charge $10K you can't afford. Is it really reasonable to expect others to pay off this debt?
@@motrock93b . The point is that credit card debt is already at all time highs. We're not talking hypotheticals here. The bubble will burst sooner or later.
Like in Seinfeld, Kramer "just write it off, these corporations do it all the time" Jerry "Kramer you don't even know what a write off is"
If charge offs are increasing, why are major banks like BoA and Amex cutting their reserves?
Yes! Banks keep on lendin', we'll keep on spendin'!
Americans
That is the only way people are spending money now.
@MHFIN, how do you think buy now pay later is affecting this data? My understanding is that it is not tracked and if I’m correct it’s a huge blind spot in accurate reporting.
umm thats what a credit card is, buy now pay later
@@davidcarp5935 as in a loan wafflehead. As you might guess, reports on credit cards do not include other loans, including BNPL, auto, and home.
Save for College… that’s a good one 🤣
College is the fastest way to slavery. Thats why the government pushes it so hard.
LOL, I got 2 teens, I'm screwed, but the worse thing is, after college, I see now a days no young person can even get a starting job, and half not even in their field, college $ down the drain within a year after, if no job, may never get job
So this data backs up the thesis of a looming home price correction. As people are stretched past their limits it is only a matter of time before they stop paying on their homes.
It is the same thing that is happening on china, houses have a market values way bigger than their utility value as a home, to a point that normal people can't afford to live in them.
Charge offs also reflect growing numbers of people ignoring social norms. In modern society throwing off social norms is celebrated. Ignoring financial responsibilities is in there with the other garbage.
Morals & ethics aren't part of their vocabulary.
I don't know if I'd lump this in, man. Most people just don't have money right now
Make every payment on time or early for three years straight? Credit Score +13. Miss a single payment after an emergency? Credit score -36 points.
My cc company just raised my limit by 7k without me asking
they'll lower it w/o asking too lol
Mine jumped up by half of that, $3,500…did not ask
What's a balanced budget ? My homes still going up in value so I'm going to keep using it as an ATM .
I'm willing to bet most people defaulting are not living within their means, and probably door dash food for every meal.
Just released? On Apr 10, 2024. Today is Apr 24, two weeks ago.
The ppl are a reflection of their govt
Vice versa
US credit card debt today is 1.3 trillion dollars. It is not hard to fathom many CC holders having maxed out their cards and are now expecting CC debt forgiveness, kind of like the student loan forgiveness in the billions recently. I will also venture to say that if there is no forgiveness for these CC debt holders, they'll simply walk away and not pay.
I would like to see that chart from 1980 to 2024
Considering that credit cards weren't widely used until the 1970s or 1980s I would assume the chart starts at roughly $0 billion in 1980.
Well Inflation and Intrest rates going through the roof is a likely factor
The freakin interest rates. What’d you expect?? Keep raising em, Feds. 🤨
The pinch is real. Good luck retiring. Good luck earning more than life costs as a Millenial or younger.
max them out and let the greedy banks worry about it if you can not pay them back🙂
There’s only so much you can take from your future self honey
YOLO attitude after Covid encouraged people to borrow. Now the bill has come
Why do people even use credit cards? If you can’t pay for it, don’t buy it. The only loan I have is for my studies and home, i bought a car I could pay without a loan. I can’t see myself having any other loans.
"crash the stock market" cried Chicken Little, "more clickbait" whispered Foxy Loxy.
If I go for a charge off then I don't need to pay it back, right? Sounds like a win to me.
well u will have bad credit, no more loans for you for new car, house, anything, plus some employers check credit as part of background check keep in mind!
I highly encourage u to look into a bankruptcy attorney. U gonna get sued if u just don’t pay anything
Skynet has become self aware
Consumers aren't financial responsible to pay thier debts. All responsibility is on the debt lender.
who are these people? I would really like to see the 'consumers' who do this. are they in understandable circumstances? are they idiots? what is there "average" story.
Credit raises prices and devalues savings. I hate credit as it reduces my ability to negotiate a good price when the salesman can just as easily sell to the fiscally irresponsible who only care about the monthly payment.
things are going as planned the fed said that their would be pain before things got better and they want job loss. thier wanting employers to only raise pay by 2 too 3 percent shows how out of touch they are with the worker.i was working at a job i only got a 3 too 5 percent raise and you know what the outcome was after 19 years i was still making take home pay of 10 dollars an hour.
Older generations stole the younger generations future.
How so?
@@motrock93b that's what happens when you BORROW money as the federal government. They borrow money from the future and distribute it NOW, in a way that is weighted to favor those closer to assets. Now, that same future that is screwed will just borrow from the future after them.
The ponzi goes on so long as US debt has value
Generation Zero.
Zoomers would've wasted it anyways
Which gen did, i know i dint.
Quote me: "Open credit is an open casket".
My credit score is 809, with 0% credit utilization. I've lived below-poverty for the past 12 years. You don't need everything society tells you to need.
Love how the spike in credit card debt happened during Biden current term…. Well because everything costs more and people are using credit cards to subsidize purchases for normal items like food, gas, that are necessary in many cases not simply luxury items.
When credit starts getting used for essentials over luxuries, the house of cards has grown too big!
It... was.... Pu.... Pu.... Pu.... Pu.... Putin's Pr... Pr.. Price Hike. (TM)"
Credit card debt was a thing long before Biden was VP for Obama.
Blame corporate greed
@@scherzva how is 20-30% rate even legal, its crazy
@@scherzvaThese people will blame anything except their corporate overlords, thus ensuring nothing will ever get fixed.
People don’t care anymore. They just YOLO all their bills.
should we all just stop paying now?
Yes
Who cares, we learn from our government. No fiscal responsibility.
The Govt can not pay their bills and weite checks with no money, we cant!!
You are going to pay for your government being irresponsible through high prices.
@francismarion6400 lol you pay for stuff.
@KBeez33 Yes, I do. What else are you supposed to do, steal?
@francismarion6400 its only stealing if your convicted.
So what you're saying is I can charge $50,000 on my credit card and not pay it for 6 months and be good? 😅 Sounds like a good deal to me
Well, there is no debtor's prison in the US. But you will become a pariah.
So we all knew this was coming. Not like this is the worst thing anyway
so they doubled in 12 years, BUT inflation made the money worth less than half. These charts need to be inflation adjusted to mean anything. Please do that.
@1:19 I see a clear trend line going up from 2014 to 2023, we would probably be at the same point if covid had never hit.
@2:19 shows the same trendline for Revolving Credit, this was predictable by 2016
Inflation adjusted though, wouldn't a 1000 dollar balance be the $750 from 5 years ago? Nothing burger. That line literally always goes up
That’s 30% in five years. That rate of inflation is what makes future Banana Republics.
FJB and this pathetic Govt!!!
I use my credit cards for everything just for the cashback I get. On average I get 200 free dollars a month just on purchases I'd make anyways. You just have to make sure you pay it off every month and the benefits are worth it.
I lost my job around 22 and i just stopped paying my credit card bills and long story short they closed my accounts and now im paying off the collectors 1k a month so i wont get sued 😂 im a fuck up
I live on one dollar a week; I buy a burrito. at Dollar tree and divide it up into eight parts and sell my brother 50 cents worth, one part and i still have 7 meals for the week, be a minimalist, don't play the debt slave game.
Look after your health. No use being the rich guy in the cemetry
You can do better than Dollar Tree. Make bean burritos better healthier and cheaper.
All the married millennial couples I know have a large upscale home 2 luxury cars - all the trendy clothes as do their 2-16 yr old children - all being supported by credit. Go broke keeping up with their millennial friends. Bankruptcies will be a big thing over the next few years.
Just dont pay the credit cards .... I call it ba with their robbing interest rates
🐝🧛🏻♂️ Financial Bloodbathzzz 🧛🏻♀️🐝
I am dead.
Moody the Millennial is getting in trouble.
The inflation rate is much higher than the official one. So people are paying your bills with credit cards. This means their balance keeps rising so at some point in the future.The whole house of cards will come in. But the fred will government will just print more magic money and l will be Good. What a joke, Just kicking the can down the road like they always do.😢
A credit card is an insurance to protect your bank account, you should never borrow money on a card. Using a credit card to borrow money is like using a hammer to brush your teeth. I have two cards, and they are emptied every week.
Easy fix, FED cut rates and start QE and government starts sending out stimulus checks again, but be prepared for hyperinflation.
There is no way.. i just paid my mandatory minimum of 128.00$ 🤣
Good luck brother!! 😂
I think generally people lean on unemployment rates too hard. There is a gross disparity in economic distribution between the working class and the top 1%, larger than ever seen before (Pew Research Center, "Trends in income and wealth inequality").
There may be more people employed, but each earns less than before. So of course they would need to lean more on credit if they're making less. Interest rates make it hard, the housing market is bleak, and general "doom and gloom" makes people less motivated to invest in their future. This lack of investment (or resources to do such) results in a vicious cycle of "short-term investment" (investing in your immediate joy, a very capitalistic practice). This is great for companies, and terrible for the working class. Our environment influences our behaviors, so we can't entirely write it off as the working-classes fault.
Let's give the working class more resources to invest, to pay off their debts, to live. I think the entire economy will benefit. The where/how we do this, I'm ill-equipped to suggest solutions for.
37% of the American population are supported by taxpayers. 78% of those working live paycheck to paycheck. Debt is at all time highs for every sector of the economy. Interest rates must keep rising. Any guess what happens next?
Biden says everything is great……. Hmmmmm
True, but lets be real, anyone who gets elected, even if it is Trump, will say that since they started things are absolutely amazing lol.
Everything is great with the economy, you being broke is your fault, not daddy Biden's.
I just bought a motorcycle, muscle car, atv, maxed out my 30k credit card and bought a house... basically I'm convinced that the economy is going to collapse next year and hyperinflation will make it so I can easily pay everything off >D
These young people pretending to be rich. Buying designer clothes and drinking 10$ Starbucks coffee everyday. Pure ignorance and lack of education.
Or it could be that this is what the end point of capitalism. People are going into debt just trying to survive. Food prices are high, medical bills are being paid with credit, rent is insane. Yes, stupid young people exist, but they make a small percentage. This is a result of building a system that sets them up to fail.
Sounds like theyre doing better than you.
@@kayakexcursions5570 I got 2 rental properties plus one that I live in with other passive income. Sure yes they are doing better than me.
6:30 The discrepancy is due to machines doing all the stock trading. Machines invest your 401k into. There is no psychology involved. Its not good for most of us but I guess it insulates the super duper rich.
We are leveraged to the nuts on 1 income and paying for 2 places to live right now.
Got 50k in unsecured debt from my wife's Nurse Practitioner Degree.
She starts working in 2 weeks and will be earning $190k a year.
Can't wait to be debt free in the next 6 months.
When isn’t a tough time for millennials financially 🤣
Zero debt here. It’s easy. Just be smart.
Credit Card Debt + 51% since Obiden was installed
30 day went from a running average of 1.3% to now 1.9%. Nothing to worry about.
@@SomeUserNameBlahBlah 30 day? Us CC debt $900 B with 10percent at minimum payment, nothing to worry about if you go to Liberaligion
Most of that debt happened during Trump though lol
@@TheRealCatof I don't know where you get that? up 51% from 2021 to present, that is all Obiden lol
@@djc7039 Wow, what happened in 2020 -2021 that could have caused that?
Who cares? Stop taking out debt!!! Your loan is not supposed to be someone else’s responsibility. 🤷♂️
Tell that to the government.
@@floridaman7 exactly! Where is my stimmy bro?😎
That last sentence is a grade school take. Just a fancy way of saying you’ve never had to co-sign a loan…
@@NickDarrashasgonefishing lol. A loan is meant to be a loan, meaning you pay it back with interest. It is not a grant.
Once again, another elementary outlook on loans, given that the word interest is used, instead of "private, lazy creditor tax"... I don't think you've read enough on national/state debt laws or the history of moneylending over centuries...
It’s still below average clickbaiter, an increase from record lows doesn’t necessarily mean much
Well if the greedy credit card company's had not have raised their intrest rates sky high then people wouldn't be paying $100+ intrest each single month. The companies have no one to blame but themselves. No wonder they say screw paying it
If millennials are struggling, why does the system hand out money to rich boomers at their expense?
🤔
Bail out lol
this guy gets views specifically on scaring people. Accounts like this are terrible
Just another All Doom , All Day YT channel
You watch the end?
@@MHFIN rebound another way of saying "correction"?
Yolo
first