- cross-posted to:
- news@lemmy.world
- cross-posted to:
- news@lemmy.world
Americans’ credit card debt levels have just notched a new, but undesirable, milestone: For the first time ever, they’ve surpassed $1 trillion, according to data released Tuesday by the Federal Reserve Bank of New York.
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Sure it does. You got ground level which is trust, above that central bank, above that fiat currency, above that companies/people, and above that banks.
You orders machine from my employer. You put some down and the rest you pay on delivery. To buy the raw materials from middlemen, we put some money down and pay the rest on delivery (or use a po but that is complicated way of nearly the same thing), the middlemen put some money down and pay the rest on delivery, and the employer of them hasnt been paid enough yet so is borrowing some from the bank and is depending on two week payperiods. The employees are renting and owe money at the end of the month to a landlord who is still paying off a mortgage to a bank, who is using deposits that can be summoned at all times…
The same x amount of money is multiplied. This x amount of money becomes y*x amount of debt. It is all abstractions on abstractions with no bottom. Since even if you say trust is the bottom it is really just trust that the top of this process will continue to work.
Sleep tight.
Wait wait wait., but that just sounds like feudalism with fucking hedge fund bros, real estate speculation, and a bunch of extra goddamn steps…
Well I mean I don’t think your life is as bad as a 12th century Russian serf.
Indeed, even Kings would envy us right now. Just even the luxury of having to not slave away for weeks just for a lump of stale moldy bread is a marvel.
We have an hyper abundance of food at our hands. You can even drink a delicacy called coffee together with another delicacy called cinnamon without murdering countless on the way to your table together with the miracle of milk kept fresh through days or even weeks or months without it even getting a stale whiff.
There is even more to that, but the luxury of partaking in it and complaining about it, thinking our lives are somehow worse, while trying to destroy what countless generations sacrificed themselves for, knowingly or unknowingly, is the biggest luxury of them all.
Paying a portion later means more cash can flow through the business and provide utility today. Your post implies that every business operating this way is effectively insolvent without access to credit, but even if your employer has the money to pay for the raw materials today, it generally isn’t in their best interest to do so
Sure. There is going to be variation. Some companies are going to be money empires, I have heard ship builders usually are but can’t confirm that. Plus you got like tech startups that can spend a decade without making a penny.
And yes it generally isn’t a good idea for a business to pay for everything right away. If they run low on cash they will have to borrow vs delayed payment means an interest free loan. Back in my freelancer days I used to get furious about net-90. Do all the work, lay out all the expenses, and still have to wait 90 days to get paid.
Without trust the whole thing burns to the ground. Good thing everyone trusts that the banks won’t fuck us over and demand a bailout, that will never happen.
Stop making points, but you’re totally right… How I look at it at this point is it’s like gangs… ya I know I owe you 30 trillion, but I’m giving you hundreds of billions a year. And I have more muscle than you. So why would you try to collect when I can kick your ass and you still get enough to pay your debts without conflict… I want someone to correct me, because Ive spent a lot of time trying to understand more nuance to this situation
Edit: I realize I’ve missed some punctuation. If you’re confused, just ask
America has never had a larger population. More people, more credit cards, more credit card debt. Seeing a per capita breakdown, or defaults per 1000 people might be better indicator of economic turmoil.
and there are people like me who buy everything with a credit card but pay off the entire balance each month
even though I technically have a credit card balance it gets reset every month and I never pay interest or late fees so the numbers don’t tell the whole story
but I’m sure there are an alarmingly large number of people who actually are buried in debt, especially with rent and other costs rising so it won’t be pretty when things reach a tipping point (probably already have…)
Seriously. I get free first class international tickets and a few hotel room nights paid every year with points and miles I get from credit cards, every year. And I use my credit cards for business expenses and get even more as a result.
Why would I ever use a debit card? I like full reclining on the flight back from Europe.
I would like to see some more meaningful metrics than offered in this headline.
Stop trying to throw statistics into sensational headlines!
Or maybe interest paid. I sometimes have a higher balance for the month, but I always pay it off entirely. Nonetheless, my credit score fluctuates based on the balance at the time of reporting.
I’ve noticed that too. It should not count as a balance if you pay in full every month. I assume this is counted towards this trillion dollar amount too which it should not.
A single income used to afford a house, and family, a car or two, vacations, and retirement savings.
Then we needed families to have two incomes to have that lifestyle.
Then we held on to that system, but had that lifestyle, WITHOUT the building up of any savings, and without the vacations.
Then we needed two incomes just to be able to LEASE that watered-down lifestyle.
And then we needed two incomes and good credit to juggle that watered-down lifestyle, and deferring debt to some point down the road when we assumed we’d be high-income earners.
Now we are in stunningly dangerous territory. We’ve largely given up any luxuries, and we struggle to find the CREDIT to LEASE basic essentials like housing, food and medicine. Often we fail to do so.
Inflation has hit us incredibly hard, but when student loan payments start up in mere weeks from now, it’s going to be CRIPPLING, not just to those with debt, but EVERY business that needs those people to buy their goods and services.
We’ve been robbed of our future by corporate greed and the psychopathic cruelty of the boomer-run government.
… And just in the past 6 months we’ve seen the invention of the first artificial general intelligence. Even if it never got any better than it is today, it would still decimate the workforce. But it is getting better. At a staggering rate. We are headed for a jobs crisis the likes of which has never been seen in all of human history.
Add to that the rise of fascism in a global scale.
Add to that the hundreds of millions of anticipated climate change refugees, and potentially catastrophic failures of the ecosystems which sustain various crops.
Add to that that all of human experience and evolution has left us WILDLY unprepared to understand let alone solve problems of this pace and magnitude.
It is difficult to see how we survive this.
Not that I support everything about her, but Elizabeth Warren literally wrote the book on our 2 income problem.
Society tracks “family income” and for a gigantic portion of history that was one income, then in the 60s-70s women started entering the workforce in larger numbers (in the US, not sure about globally) and we see family income “rising” so we think “great, we’re growing! We’re doing well!” Except that it only grew because of an additional income.
Now we’re at the point you’ve mentioned where that isn’t even enough anymore especially when the vast majority of jobs seem to offer around 50-60k unless you’re a specific professional/tech bro.
I’m a perpetually single blue collar schmuck, I’ve completely given up on the idea of homeownership, and am very very quickly realizing my retirement plan has to be a shotgun to the head.
What a wonderful future we have to look forward to.
And I’ll just add this so no one has to later: GlObAlLy We’Re BeTtEr ThAn EvEr! Because you know, that totally helps…
Very well written and accurate. I just want to add that the financial requirements to raise children have been out the window for some time as well. Not that they would want to exist in a world with climate change anyway.
That’s the thing tho … most humans won’t survive this. The super rich are buying up remote properties/islands at an incredible rate and want Mars asap.
Most of the rest of us will die of starvation, fires, heat, dehydration/poisoned water or the massive storms.
Mars is a pipe dream. Unless Earth goes full Venus, it will be vastly better then Mars for at least the next thousand years. Terraforming Mars would be a centuries long endeavor, and terraforming Earth would be vastly easier.
Funny how the “You took a loan, pay it back” idiots never seem to care about dischargeable credit card and business debt.
I guess that kind of debt needs a safety net since they might have some of that kind, while new adults who committed the crime trying to better themselves, that pursue integral vocations that society desperately needs but don’t pay well, like teaching and counseling, should just fry like piggies while their fellow Americans laugh at them out of sweet, sweet schadenfreude.
Our values are wrong.
No one has enough money to live anymore. This isn’t a problem of people being reckless, they’re using credit because there isn’t enough money coming in to pay for everything.
I’m doing my part!
Would you like to know more?
Waiting for them to universally forgive missile loans. Man why would you spend so much money on missiles, of course you can’t pay that back, even if it makes you a higher earner in the future
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Why did your credit take a huge hit, due to non payment for X months?
That’s generally how it works.
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I guess it’s time to dust off that credit card and join the fun
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Man, you’d think after the Great Depression and the recession of the last naughties we’d have figured out that credit is a disease and we should stop participating in it so often.
Man, I knew that COVID-19 caused reductions in spending, but I hadn’t realized that it had caused such a significant payoff of debt. Like, I could have believed it causing an increase rather than decrease in credit card debt.
I’m surprised by the increases before and after, though. You’d expect some increase over time just due to inflation and growth of the economy. And that chart isn’t zero-valued.
Lets check how much is just inflation…
gets inflation calculator
Okay, so inflation is responsible for a 32% increase between 2013 and 2023.
There was a 49% increase in credit card debt over the same period.
So most of the increase in the chart is just inflation.
Population increased by 6.5%.
So that explains a 40% increase, together.
And there’s a gradual increase in the size of the economy over time. I don’t know how that’d best be measured in terms of what should translate into credit card debt.
But point is, while there’s probably some increase there, it’s not a huge one in real, per-capita terms, which is what you’d care about.
The credit card companies want you to be in debt. That’s thier entire business model. In fact, it hurts your credit if you never have any debt on your cards.
Sorry guys I’m trying to hit my sign up bomus
