Credit card debt hits new record, raising warning sign

Costco is kicking Sam's asses here in my city. Cisco is a distributor here for mostly restaurants and such. I don't think they are open to the public here.

 

And every year Reagan requested less spending than Congress authorized and spent and they refused to pass all the spending recissions he sent to them.

With the HUGE spending increases coming from the Democrat congresses of 2007 and 2008 when they increased spending for FY2008 9% and then for FY2009 18%. The Republican congress handed the Democrats a paltry $161B deficit in 2007 and two years later the Democrats had it at $1,400B and kept it over $1,000B for the next 3 years.

Thank you Gingrich and Kasich. Clinton requested MORE spending every year than the Congress authorized.

The Democrats took control of the Budget January of 2007. Presidents do NOT singularly control the budget, they have the least input compared to the House and the Senate.

 

We have a Sams, a BJ's , and a COSTCO in three large towns who share borders. We are closer to a BJ's now since we moved so I joined that for the gas station being nearby. I never been to a COSTCO and do not care for the town / little baby city it is in and do not want to drive 12 or 15 miles when a BJ's is a mile away as the crow flies. The advantage BJ's has over SAMS us that they have a deli but no liquor store. But SAMS did carry black angus beef in bulk like an entire filet and whole ribeye sections boneless so they can be cut into steaks. BJ's carries US Prime but not bkack angus US prime. To me they are compatible.

 

The sequester. But then it is more a matter of restraining the growth of spending while growing the economy and getting everyone working and paying taxes.

1998 69,270
1999 125,610
2000 236,241
2001 128,236

 

Why are we back to discussing the federal debt?

The topic of the thread is private debt, which is the far bigger elephant in the room. And the signs that Americans need to spend money they don't have to keep the economy going are not good.

On top of credit card debt there are auto loans. the average loan is now 5 YEARS. That's right, in order to sell new cars, the ONLY way to do it is to sign buyers into longer and longer loans. Then, the car is underwater the moment it is driven off the lot, and after 3 years, the remaining balance is rolled over into the next 6 or 7 year loan. How is that a sustainable business model?

The reality is, 60%+ of Americans really CAN'T AFFORD new cars.

How any of this are signs of an economic boom is beyond me.

 

Got Sam's when you had to be a business or organization, was married at the time with kids. We did use it some then for family purchases. My ex used it then for her catering needs or special events. As the kids moved on we used it less and being single now I throw out enough stuff that gets old to be buying in bulk so dropped the Sam's Club. We did get a Costco here 3 years ago and I purchased a membership mainly to buy a new computer and some furniture which Sam's doesn't carry AFAIK but I let it expire because it is across the bay in another city. I think this Sam's thing was planned many months ago.

 

Specifically designed to hurt Obama and to harm the economic recovery, not because of concern for the debt.

Under Clinton, thanks for clarifying this. But, we know already that you'll cherry pick data to make it seem like the republicans are actually fiscally responsible.

 

While I never go beyond 48 months cars last a LOT longer now than cars of the past. Even at 36 months you are close to being underwater the moment you drive it off the lot, the difference is how long it takes to get above water so that if you sell you can show some equity. I buy used instead of new so I don't have to pay for the depreciation up front or I use a "Family and Friends" program as I sell to several auto company manufacturing plants, that pretty much wipes out the initial depreciation.

 

BJ's sent me a 3 month free membership when they opened here. I went because it was close to home. I walked around, and as a single person at the time, didn't see why it would benefit me to join. That was the only time I went. My wife is a member of Sams, for the cosmetics and meats alone. Other than that, not much else. They do have nice cuts of beef, and awesome poultry prices on a daily basis. But I am not willing to drive 10 miles just for a couple of things. It's her cross to bear.

 

It was to stop the bleeding and the HUGE increases in spending and in the deficits caused by Democrat budgets. They increased spending 9% in 2008 and then 18% in 2009 taking the last Republican deficit of $161B to their WHOPPING $1,400B in just TWO YEARS and had kept it over $1,000B, how much more spending and deficits and debt did they want. You're on the one hand complaining about them but when pointed out they rest with the Democrats now defend them. Which is it?

What's that supposed to mean "Under Clinton"? He OPPOSED the measures that produced those surpluses and requested HIGHER spending than Gingrich and Kaisch would pass and only signed their budgets and welfare reform when Dick Morris told him if he didn't get on board with them he would lose the election and even more seats in the congress. And what cherry picking and be specific. The last Republican deficit before the Democrats took back the Congress in 2007 was a measly $161B after their worst of $400B in 2004 during the recovery. How close did the Democrats come to the WORST Republican deficit?

 

That’s true, but the population as a whole has gotten financially dumber and more irresponsible then ever before.

 

I didn't think that was possible.

Millennials?

 

Perhaps, but I think (through observation) that everyone who relies on a smartphone to look any/every question, instead of actually using their brain, and experience to think about it rather then asking Google has a lot to do with it.

Ditto for everyone using GPS to get anywhere. Try giving verbal directions to someone one day and watch their eyes glaze over as they cut you off and just ask for the address so they can use the GPS.

 

I don't use a smart phone, I don't want to be staring into a tiny tube everywhere I go. People that do are irritating, particularly those who think FaceBook defines their very existence. The "look at me" generation of cart wheelers. GPS is great, especially for marine applications. I don't rely on GPS for road mapping normally, it's not 100% reliable to begin with.

 

The Fed papered the planet with storms of imaginary money in the last "Great Recession', and they stuffed all this funny-money into normal banks via the 'discount window', which allowed the banks to be bulging with cash, and to make a tidy profit by just sitting on money with no risk to themselves. It positively stank of corruption and manipulation. Like I said, the Fed usurped all power and authority, declaring virtual "martial law" over the entire economy, stomping all over the foundations of a free-market economy.

Hey, none of us was born hating the Federal Reserve System. It was an acquired viewpoint, adopted after watching what this manipulative internationalist combine has actually has done to our economy!

Now all this easy credit and near-zero interest rates have helped propel this more recent plunge into personal indebtedness. My guess is that they've continued this insanity to push up inflation in order to soak up the artificial 'pudge" they created, but I suspect that this will not end well -- especially given the size of the Fed's 'balance-sheet'.... . But, me? I have no debt, and I'm not taking on any debt, either....

 

You are absolutely correct that the average new car loan is 60 months. That is a problem when the average sort of good car costs 30 to 33 K before sales tax. You put 10 or 15 % down yo are borrowing close 27 or 30K. That is more than our first house cost but that was a 20 year mortagage. A 27K car is $450 monthly Plus interest I will guess will be $600+ with interest since I found not have my amortization APP open.

 

I know when I'm finally forced to buy a "new to me" vehicle it will not be new. What's irritating is paying for non-essential technology to move from Point A to Point B, it drives up the cost, not to mention replacement parts and specialized equipment to work on and maintain it.

 

Our BJ's has a tire shop and my CrissoverSUV will need 4,tires soon but it is old so it is not getting Pirellis this time which can run $750 to $800 they have BF Goodrich and Coopers at a good price. It came with Pirellis great tires but at 75000 k miles it can have BF Dumwacks....

 

Only 75k? That's just a pup. I'm pushing 285k on my Yota truck and still burning rubber. Finger's crossed for 500k. It's been a beast without a lot of maintenance.

 

I wish they'd still make actual base model cars and sell them for reasonable prices. Today, even the base models have everything I would ever want, including back up camera, all kind of fancy entertainment hardware etc.

We tend to buy the lowest cost model new and then drive it for 10 years. In fact, lots of used cars have higher trims and cost more than a new base model, even when 2-3 years old, so you don't save as much buying used. It seems that the "upsell" always works and that consumers can easily be talked into spending a few $1000 more when they are already spending $30,000 for a new car. it is all about wants, not needs, and the car salespeople exploit this.

 

Correct.

 

I bought mine over the dealership internet site............a LONG time ago. I'd rather submit to Chinese bamboo torture and waterboarding than walking into a dealership. Just picking up the truck and signing paperwork gave me the hives.

 

FYI, if the loaner and loanee are not in agreement, and they both sign, then one is guilty of extortion. The lending issues are usually due to "predatory lending", where the lending company over charges the interest for some simple and/or singular reason, without properly informing the "lendee". That plus bundling the bad loans with good loans and identfying them all as good loans is another issue. There are rules that help prevent the over lending of banks, that is where the deregulation will allow the overlending greater chances of happening.

 

Absolutely. Total cost to own for a new car runs in the range of $5,000 per year, even for a subcompact car. Tell me how the family making the median income of $53,000 before tax can afford this? If they have two cars, they'll easily spend 25% plus of their income on transportation. And then there is the Escalade that some people think they "need". That one will cost you $15,000+ a year total cost to own over 5 years.

 

I was just reading that car manufacturers are slowing production and living on fleet sales right now, as demand for new cars is slumping.

And then, fleet sales like rental agencies end up dumping huge numbers of good condition cars on the used market, giving even more competition for new car sales.

They're doing well in trucks and SUVs, helped by low fuel prices, but the prognosis seems to be that there will be some plant closures in cars.

...or so they say.