In April credit card debt was once again the largest contributor to the new all-time high in consumer debt, increasing by $7 billion vs. a decline of $2 billion in March. Student loan and auto debt hit all-time highs of $1.6 trillion and $1.16 trillion, respectively. I found the credit card debt numbers interesting because a report released by Experian showed that 23% of Americans need credit card debt to pay for food and rent – i.e. make ends meet.
The Achilles Heel of the U.S. economic and financial system is debt. Easy credit artificially stimulated the U.S. economy (and global economy) for the last 8 years. Most households are running out of their capacity to take on more debt, which means consumption – 70% of economic activity – is going to contract.
Rethinking The Dollar invited me to discuss the trade war, the economy and precious metals and why stock market catastrophe is baked into the cake:
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