Last week, score bureau DBRS raised a red flag when it calculated in the past decade average US wages have risen by just 5.7%, while consumer debt within exactly the exact same period rose 60 percent more, or 9.3%. However, while the US household’s reliance on debt to fill in the income gaps is barely news, on Monday JPMorgan found another, much more concerning debt inflection point: household debt, even fast as it might be rising, is about to be eclipsed for the first time ever by the faster rising national government debt. As JPM writes in its weekly market recap, before the Financial Crisis, family debt relative to national government debt hit a minimum of 3 to 1 times. Ever since that time, the rise has been restricted by a mix of customer prudence and bank tightness together with liabilities growing 4% since 3Q 2008. But, JPM adds, “the exact same cannot be said of the national government, with liabilities increasing almost 150% over exactly the exact same span and nearly reaching household debt levels to the first time in modern history.”
Ultimately, “this usually means that while consumers have taken steps in their accounts to guarantee a more compact debt burden, older and wealthier families ought to be especially cautious of the potential impact of rising government debt in their financing” especially once the next government – far more inclined to be of the “wealth redistribution persuasion” – decides to do precisely that. . Sourcehttp://www.zerohedge.com/news/2017-12-04/first-time-modern-history-us-government-debt-will-surpass-household-debt from http://www.nwsuburban-bankruptcy.com/for-the-first-time-at-modern-history-us-government-debt-will-surpass-household-debt/
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