Credit Tightening; Expect Wave of Poverty/Homeless
Public Surviving Off Credit now over?
Dillon Critique from; what's the DILL?
MAY 8, WEDNESDAY 2024
New Trend? Or is this Just a Temporary Draw Down or Draw Back in Credit?
Horrific:
The majority of Americas population, is living and or SURVIVING off Credit. Not wages/salary.
Maxed Out: Inside Americas Credit Card Debt Crisis
https://www.cnet.com/personal-finance/credit-cards/features/maxed-out-inside-americas-credit-card-debt-crisis-and-what-we-do-next/
About 55% of Americans live paycheck to paycheck, 36% have more credit card debt than emergency savings and 22% have no emergency savings at all. Many people lean into credit cards not because they want to, but because they have to.
Nick Wolny
Feb. 7, 2024 9:40 a.m. PT
Nearly Half of Americans Need Credit Cards To Cover Essential Living Expenses
https://finance.yahoo.com/news/jaw-dropping-stats-state-credit-130022967.html
The survey found that 48% of Americans depend on credit cards to cover essential living expenses. This is more common among younger generations: 59% of millennials use credit cards for living expenses. Conversely, only 29% of boomers rely on credit cards to cover essential expenses.
Gabrielle Olya
Wed, Jan 17, 2024
Financial Emergency: One in Three Americans Max Out Credit Cards for Survival
https://www.prnewswire.com/news-releases/financial-emergency-one-in-three-americans-max-out-credit-cards-for-survival-302088196.html
Debt.com's survey of over 1,000 adults shows that 35% of people have maxed out their credit cards in recent years while inflation and interest rates increased. More than 4 in 10 (45%) of all survey respondents cite price increases from inflation as the reason they used their credit cards to make ends meet.
Debt.com
Mar 13, 2024, 10:24
One could make a reasonable claim that; if the majority of your population is surviving off bank credit for basic necessities and to survive, your country/monetary system has already collapsed.
Is Credit Tightening?
Yes.
Access to credit is tightening
https://kpmg.com/us/en/articles/2023/q2-2023-fed-sloos.html
Banks have been progressively tightening lending standards for well over a year. For those with a heavy debt load, the cost to refinance in the current interest rate environment threatens some firms as going concerns. This week, a major U.S. trucking company ceased operations after nearly 100 years in business.
Kenneth Kim
Senior Economist, KPMG US
Fed Says Banks Tightened Credit Standards in Fourth Quarter
https://www.bloomberg.com/news/articles/2024-02-05/fed-says-credit-standards-tightened-somewhat-in-fourth-quarter
The Federal Reserve said US banks reported stricter credit standards in the fourth quarter, although the proportion of those tightening standards shrank from the prior period.
The net share of US banks that tightened standards on commercial and industrial loans for medium and large businesses compared to the prior period dropped to 14.5%, from 33.9% in the third quarter, according to a Fed survey of lending officers released Monday. That was the smallest such share since 2022.
By Reade Pickert
February 5, 2024 at 1:06 PM CST
Updated on
February 5, 2024 at 1:43 PM CST
Shocking Collapse In Credit Card Debt Growth Just As Card APRs Hit All Time High
After several months of wild swings in US consumer debt, culminating with last month's jump in credit card debt to a new all time high despite record high credit card rates, in March households finally hit a brick wall
what was the biggest shock in today's data was the absolute collapse in revolving credit growth, i.e., credit card debt, which plunged from a $10.7BN increase in February - one of the biggest monthly prints on record - to barely positive, or $152 million, the smallest monthly increase since the covid crash!
the brutal slowdown in new credit card debt is hardly a surprise since as the Fed also reported that in Q1, the average rate across all commercial banks on all credit card amounts just hit a new record high of 21.59%, which is a vivid reminders that while banks are happy to hike credit card rates, they rarely if ever cut them.
there is only so much more credit card maxing out that can take place before reality finally sets in, as can be seen in the next and perhaps most striking chart yet: total credit card debt is record high while the personal savings rate is record low!
credit-card fueled spending must be encouraged - don't be surprised if the White House instructs banks to just ignore soaring delinquency and charge-off rates...
If the CBDC system is not ready to be rolled out quite yet, they will encourage the spending spree, lax credit and ask banks to ignore risk to keep the system afloat extending the timeline, until they are ready.
If they are ready to do a monetary transition (currently in play), they will continue to squeeze the public into abject poverty (continued Credit Tightening + QE (non expansive) + Higher/paused Rates), until the public begs for CBDC as a saviour. This is a good example of the “Hegelian Dialetic”; Problem, Reaction, Solution.
The Fed created the problem, by purposely beginning to raising rates, to begin collapsing the system (Fed knew this would happen), to transition to CBDC. The green light has been given to set the sun on the US Empire. The rise of the East and fall of the West. A new “Bretton Woods”.
What Happens When Bank Credit is Cut Off to The People Living & Surviving Off of it?
What happens when the majority of the population are living and or surviving off bank credit alone for basic necessities; such as food, shelter, energy and medical and that credit is then tightened?
We can assume a rise in or wave of; “Food Insecurity” (Starvation/Malnutrition) and rise in Poverty/homelessness. Which is already taking place.
*This is not due to credit tightening alone.
Homelessness in US surges to highest-recorded level
https://thehill.com/homenews/administration/4363103-homelessness-sours-highest-recorded-level/
Younger baby boomers are facing a homelessness crisis as rents skyrocket and outpace Social Security
https://www.businessinsider.com/young-late-baby-boomers-homeless-rent-social-security-2023-9
More Americans Are Ending Up Homeless—at a Record Rate
https://www.wsj.com/articles/homelessness-increasing-united-states-housing-costs-e1990ac7
Alarming Rise in Family Homelessness in the US Amidst Soaring Costs and Housing Shortages
https://www.linkedin.com/pulse/alarming-rise-family-homelessness-us-amidst-soaring-costs-arbetter
Food banks pushed to brink as they see ‘worst rate of hunger’ in years
https://www.live5news.com/2023/11/17/food-banks-pushed-brink-they-see-worst-rate-hunger-years/
An Enormous Chunk Of The U.S. Population Is Either Homeless, Living In Poverty Or Considered To Be Among The Working Poor
https://citizenwatchreport.com/an-enormous-chunk-of-the-u-s-population-is-either-homeless-living-in-poverty-or-considered-to-be-among-the-working-poor/
U.S. Families Skip Meals to Save Money
https://www.specialtyfood.com/news-media/news-features/specialty-food-news/u-s-families-skip-meals-to-save-money/#:~:text=Three%2Din%2Dfour%20consumers%20between,meals%20due%20to%20financial%20concerns.
*It should be noted that Credit Tightening is not to discount currency devaluation (Inflation), as also being a cause for lower standards of living.
Will we see the screws continuing to be tightened down on the public to slowly collapse everything and make the transition to CBDC as the solution, as we currently are?
Or will we see credit tightening lax and the monetary transition timeline extended slightly, buying a little more time, until they are ready to transition?
Let others and myself know what your thoughts are down in the Town Hall (comment) section. I also appreciate & welcome any kind of criticism or critiques to my work.
By Dillon Critique from; what's the DILL?
https://blackboxpolitics.substack.com
YouTube Channel: COMING SOON!
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Good work. Shared on Greggory Mannarinos I sub stack.....
The QE but not enough with the higher interest rates is a good analysis...at 53 I bought my first home in 94 at a 10 percent interest rate...by the time I was 28 all my closest friends had homes, nice city neighborhoods with yards and garages....from the 20s to 40s...railroad town...I bought at 31 k sold tonsome classmates around 05 at 99 ...now a satelite college town...the largest next to main campus...during pandemic sold for 140k....never though id see this day.....now the towns jobs are all service....in my early 20s and into my 40s I traveled doing IT work.....barely any 20 year olds can even afford an apartment let alone a home....funny thing is after making up to 120k until about 8 years ago....a blood disorder took me out of fulltime work....I've now made about 40k since going part time....what I do? Have had a 1500 car for 6 years...no cc debt, my wife has a 2015 Acadia...and I ride a 03 Honda motorcycle ... I never liked debt other than homes....I had new cars and trucks and toys when I could afford it....just never got car broke or toy broke....I also feel over my life time I've seen people live way beyond there means...now they want to complain....I tell them you should have complained when borrowing large sums of money for houses and cars at low interest rates or picked up a book to see how there doing it....good news...I've always stacked Gold and silver....something my dad did....during my teens I seen it save out family for 2 years after he had stroke.....nowadays though I wonder does it make any sense to try and time the final collapse and borrow debt plus rack up cc under the assumption when cbdc come they will be cleared like student loans....trust me I watch the same people and substack I'm sure many same people you do...peace
It’s real bad, and it’s getting worse, but the problem is not just in the bottom half of the private sector. Government fiscal spending (through evermore debt creation) now overshadows all bank credit creation, and corporate bond issuance. Meaning the life blood liquidity of the economy is being powered by public debt, and the math of the debt severity is such that it can only be resolved through more inflation. This will only exacerbate more suffering of the poor private sector. We are too far gone for fiscal austerity to work, so there’s no avoiding further pain. It appears that government and the Fed are inept, or just plain sadists.