Today, the Federal Reserve Bank of New York proudly reported that household debt here in the United States has now reached a new all-time record high, exceeding the last record high which was achieved right before the stock market/housing crash of 2008.
So what exactly is household debt? Very simply, this is the total amount of debt which is owed collectively by all the adults living in a particular household.
Well America, I suppose congratulations are in order?
Here is the spin.
The mainstream financial channel experts are saying that this time consumer debt, although it is now at a new all-time record high again surpassing the 2008 credit bubble, is different this time.
They are saying it's different this time because interest rates are lower today..
I ask you, are these mainstream financial Pundits learning impaired? Debt is debt, and the fact that we have now hit another all-time high with regard to household debt can in no way be spun into a positive thing.
So what we have here in America is a national debt at an all time record high, household debt at an all-time record high, a Federal Reserve who's balance sheet (the debt they are holding) at an all time record high, and a stock market which is near all-time record highs, (being inflated by all this debt).
What you will not hear from the mainstream financial pundits, is we have a labor force participation rate that is near historic lows, and a money velocity, (the rate at which cash is moving through our economy) also near record lows.
Here is a neat bit of info for you!
You cannot have an economic recovery without both the labor force participation rate, and the money velocity both moving higher!
So, the United States of America is now the largest debtor nation in the history of the world, being occupied by adults who are now carrying their largest debt burden in history!
Again, congratulations America...
Gregory Mannarino
