Americans continue to set records when it comes to household debt. In the first quarter of this year, U.S. household debt, which includes mortgages, student loans, auto loans, credit card debt and more, rose to its highest level ever.
In other words, Americans borrowed more money than any other time in history. Total household debt rose $149 billion to $12.73 trillion overall, surpassing the old record of $12.68 trillion right before 2008’s financial crisis.
But wait, there’s more!
In the second quarter of this year, we surpassed our previous performance and pushed the overall consumer debt balance to $12.84 trillion!
Is there an immediate danger? Not really, but when debt is piling up like in 2008, it is a bit concerning.
On top of that, delinquency across all lines of credit has risen, including credit card debt that is 90 or more days late, which has increased for the third straight quarter. Auto loans of the “deep subprime” variety, which means the bottom of the barrel, are delinquent at similar rates to the financial crisis.
This data points to cracks in the recovery. The foundation is shabby. And if history repeats itself, credit markets could close, which could usher in a recession, or perhaps even another full-blown crisis.