An Indian Civilizational Perspective

Is Credit Card crisis the next one?

In this crisis these days when newer records are being set on the stock exchanges for the drops, here is another sobering thought. We have all talked about the Mortgage crisis from the debt to the consumers. But nobody seems to have started discussing the Credit Card debt.

Apparently, it may not be that big but it is fairly significant! At least for the mortgage debt the lender can repossess the home, for Credit card – what do you take away? The figures below give the information on the different types of debts in the US.

Consumer and Individual Debt

Purchases and cash advances on major credit cards in just the last year by consumers in the US = $2.2 trillion
Growth in overall credit card debt between 1989 and 2006 = 315%.
Mortgage Debt – $14 trillion in 2008

Other facts:
– fewer people are paying their credit cards on time.
– Average credit card debt rates = 14.5%

US Government debt figures

– U.S. federal debt passed the $10 trillion mark
– After adding unfunded Medicaid, Social Security, Medicare, and similar obligations, this figure rises to a total of $59.1 trillion, or $516,348 per household

Public debt = 36.9 percent of GDP
Total debt = 65.5 percent of GDP

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6 Comments
  1. DRRoy says

    Well, can anyone explain the rush to the US dollar. And for how long with the USD remain so high considering the US is basicall bankrupt — if an accountant were to look at its balance sheet….

  2. DRRoy says

    Well, can anyone explain the rush to the US dollar. And for how long with the USD remain so high considering the US is basicall bankrupt — if an accountant were to look at its balance sheet….

  3. Anonymous says

    We saw a steep rise in the dollar price in the past 30 days, the main reason being the petrol trading. We need to trade petrol through dollar only.. so the demand for dollar has rised, above that the rate of the global crude oil all fell reaching an all time low of 65$.. These reasons cause the dollar price to rise. We should expect it to decrease once the US stablises to certain extent.

  4. Anonymous says

    We saw a steep rise in the dollar price in the past 30 days, the main reason being the petrol trading. We need to trade petrol through dollar only.. so the demand for dollar has rised, above that the rate of the global crude oil all fell reaching an all time low of 65$.. These reasons cause the dollar price to rise. We should expect it to decrease once the US stablises to certain extent.

  5. Ralph Davis - Good Credit says

    Stats really scare the shit outta me. This is precisely why I hate looking at the numbers. Thanks for the post anyway, Desh. By the way, where did you get these facts?

    Ralph

  6. Ralph Davis - Good Credit says

    Stats really scare the shit outta me. This is precisely why I hate looking at the numbers. Thanks for the post anyway, Desh. By the way, where did you get these facts?

    Ralph

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