Holiday spending could mean even more debt for consumers
-- January 7, 2004
Consumer debt hit a record $1.98 trillion in October, according to the latest figures from the Federal Reserve. That's a massive amount of credit, translating to a mind-boggling $18,700 per U.S. household.
The debt -- which includes credit cards and car loans but not mortgages -- is likely to pile up even higher as the spending splurges of the holiday shopping season come home to roost.
What's even more concerning is that consumer debt continues to skyrocket in spite of record mortgage refinancing. Since, refinancing is often used to "cash out" home owners' equity, these factors together point to a consumer shackled by an almost boundless appetite for spending ... no matter the consequences.
And don't forget: Bankruptcy filings totaled 1.25 million during the first nine months of 2003 and could set a new record when full year results are reported.
These ever-mounting debts and record-level bankruptcies could spell trouble ahead for a still fragile economy.
Consumer Debt More Than Doubles in Decade