For the first time since the Great Recession hit, American households are taking on more debt than they are shedding, an epochal shift that might augur a more resilient recovery.
For two of the last three quarters, American households’ total outstanding borrowing on things like credit cards, mortgages and auto loans has increased after falling for 14 consecutive quarters before then. Some economists even see an end to the long, hard process of deleveraging — as they refer to the cutting of debt relative to income or the nation’s economic output. That process, they say, has been a central reason for the extraordinary sluggishness of the recovery.
“We’re at an inflection point,” said Kevin Logan, the chief United States economist for HSBC. “Debt is less of a burden” for households, he said.
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Filed under: * Economics, Politics Economy Consumer/consumer spending Corporations/Corporate Life Housing/Real Estate Market Labor/Labor Unions/Labor Market Personal Finance The Banking System/Sector The Credit Freeze Crisis of Fall 2008/The Recession of 2007-- * Theology Ethics / Moral Theology
Posted October 27, 2012 at 9:29 am
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