Monday, August 29, 2011

Recession leaves many in permanent cutback mode

Since the third quarter of 2008, overall U.S. household debt, which includes credit cards, mortgages, student loans and car loans, has declined by more than $1 trillion, according to the Federal Reserve Bank of New York. While the rate of the decline has slowed somewhat in recent months, total consumer debt is still down 8.6% from the third quarter of 2008.

Some of the reduction in debt stems from tighter credit standards, which have made it more difficult for consumers to borrow. Financial institutions have also written off billions in debts deemed uncollectable. But other trends point to a dramatic change in household balance sheets.

Read the rest of the article at USA Today

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