10 comments

  • happytoexplain1 hour ago
    Does a balance that has not accrued interest count as debt for this measurement? I.e. people who always pay the statement.
    • panarky1 hour ago
      The $1.26 trillion Federal Reserve figure includes both balances paid in full every month and balances accruing interest.<p>Convenience spending by &quot;transactors&quot; (roughly 35% of cardholders) who pay in full every month is something like $200 billion of this.
      • fhdkweig1 hour ago
        Do you have a citation for the 35% number? I wouldn&#x27;t have thought it was that rare.
        • panarky1 hour ago
          Let me Google that for you ...<p>Ah, here it is <a href="https:&#x2F;&#x2F;bpi.com&#x2F;missing-factors-in-the-cfpbs-analysis-of-rising-credit-card-interest-rates&#x2F;#:~:text=As%20shown%20in%20Exhibit%204%2C%20the%20share,to%2013%20percent%20over%20the%20same%20period." rel="nofollow">https:&#x2F;&#x2F;bpi.com&#x2F;missing-factors-in-the-cfpbs-analysis-of-ris...</a>
      • happytoexplain48 minutes ago
        I&#x27;m shocked how small that part of the pie is. That&#x27;s concerning.
        • tokioyoyo41 minutes ago
          There have been a couple of episodes of Simpsons where “credit card debt” was the subplot. Should give a good idea how “relatable” the experience it was even in the older days. Obviously I’m exaggerating, but you get the idea.
          • fhdkweig37 minutes ago
            I can understand how someone right on the edge of disaster (and Homer was always on the edge) would get into debt, but those numbers would imply 2&#x2F;3 of people are in what I would consider imminent financial collapse. Surely people couldn&#x27;t exist in that state for lengthy periods of time. Right?
            • anonymars24 minutes ago
              If I remember the stats correctly, I believe in the US the lowest 50% of households combined have maybe 2% of the wealth
            • anon700013 minutes ago
              I mean does it necessarily imply that? You could pay just the minimum payment for a very long time with no consequences, I think. The main problem is you’d hit the credit limit and would have super high interest payments. But even then the minimum payment may be viable.<p>But yeah, reality is that <i>most</i> people are not white collar workers with decent income. HN is probably one of the higher income forums on the internet just because of tech. Definitely a bubble here
            • tokioyoyo16 minutes ago
              Sounds about right.
            • squigz34 minutes ago
              They could, and do.
    • 9cb14c1ec01 hour ago
      Technically, people who always pay the statement do have credit card debt until they pay, it&#x27;s just free debt.
      • rootusrootus30 minutes ago
        I&#x27;m still surprised they don&#x27;t track it separately. According to my credit report I have what appears to be a running balance of 5 or 6 grand. I suspect a machine learning algorithm could watch the way the balance bounces around and accurately guess that I pay it off each month, but there&#x27;s no distinction on the credit report at least. In my mind a balance where you only pay off a chunk each month is different entirely from one where you always pay the entire amount. And I&#x27;d put a third category in there, too, credit card debt for which you are only making the minimum payment. This all seems like valuable data when assessing creditworthiness.
        • twoodfin7 minutes ago
          The credit bureaus score based on the % of credit you use (and of course that you pay on time).<p>This is basically equivalent from a credit risk perspective, the banks don’t really care what % is interest vs. principal.
      • pocksuppet55 minutes ago
        Not just technically. They literally have credit card debt in every sense of the word.
        • ticulatedspline38 minutes ago
          while true the connotation of the title would imply meaningful debt. And people who simply use cards for convenience and never hold a past due balance isn&#x27;t really meaningful debt.<p>It&#x27;s almost like counting the &quot;debt&quot; between ringing up your items at wal-mart and paying. For those 30 seconds you owe money.<p>Based on some quick stats you could totally turn that into a useless headline &quot;Americans accrued 4.1 billion dollars of debt every 30 seconds in 2025&quot;
  • panarky1 hour ago
    Now do total debt: government + corporate + household<p>Then add unfunded liabilities like pension benefits and healthcare promises for every federal, state and local government, school district and corporation.<p>A trillion of credit card debt is something like one half of one percent of total indebtedness.
    • trhway4 minutes ago
      &gt;A trillion of credit card debt is something like one half of one percent of total indebtedness.<p>exactly. it is just $4K&#x2F;person. Whereis current US national debt is $120K&#x2F;person.
  • wilg8 minutes ago
    Basic media numeracy will tell you that because the population is increasing and inflation exists this number is not meaningful.<p>It sounds like it&#x27;s describing &quot;the problem with credit card debt is worse than ever&quot; but this number cannot tell you that.<p>Fortunately, the data does exist and has been analyzed and it&#x27;s already been put together for you here: <a href="https:&#x2F;&#x2F;www.philadelphiafed.org&#x2F;surveys-and-data&#x2F;2026-q1-large-bank?utm_source=chatgpt.com" rel="nofollow">https:&#x2F;&#x2F;www.philadelphiafed.org&#x2F;surveys-and-data&#x2F;2026-q1-lar...</a><p>The good news from doing the analysis properly is that this situation has been improving recently. (You will find this a lot when people panic about statistics.)
  • 2OEH8eoCRo02 hours ago
    The American consumer is an enigma
  • Wowfunhappy2 hours ago
    ...I&#x27;m not saying this is good, but doesn&#x27;t the existence of inflation mean we&#x27;ll always keep breaking this record?
    • paimapi33 minutes ago
      yes but you can graph trends over time: <a href="https:&#x2F;&#x2F;www.newyorkfed.org&#x2F;microeconomics&#x2F;hhdc" rel="nofollow">https:&#x2F;&#x2F;www.newyorkfed.org&#x2F;microeconomics&#x2F;hhdc</a><p>for example, the last time we saw a nice little rise was in 2008 where nothing bad happened and everything was okay (look at the 90+ day delinquency rates). at least housing and mortgages are fine for now but if there was ever an actual recession indicator, this may be it
      • anonymars20 minutes ago
        I think you&#x27;re putting the cart before the horse: the rise looks to have been constant, punctuated by then <i>leveling off</i> and <i>falling,</i> of which we currently see only the barest hint
        • paimapi16 minutes ago
          we&#x27;re looking at the 90+ day default line chart? 2008 saw an increase from sub 8% (which seems to be the norm) to 13%. 2023 was at 7% and we&#x27;re right now sitting at 13% again. there are no other significant swings in credit card debt
    • ticulatedspline31 minutes ago
      yep, and depending on what meaning you want to derive population matters too. also kinda like all kinds of movies have been breaking sales &quot;Records&quot; but if you look at the inflation adjusted top ten, #1 is still &quot;Gone With the Wind&quot;.
  • amazingamazing2 hours ago
    Not adjusted for inflation, so useless. At least do % of gdp which is also flawed but better than this.
    • mathgeek1 hour ago
      Since wages have not kept up with inflation, it’s already factored in as inflation drives the total debt faster. Total debt rising without a corresponding rise in wages means an increase in interest and defaults in general.
      • alphabettsy1 hour ago
        A total measured over the entire US economy without adjusting for a variety of factors including inflation and population change seems like exactly the kind of thing you would expect from a news headline. How about average or per capita?
      • wilg18 minutes ago
        The median wage has kept up with inflation anywhere this line is flat or sloping up: <a href="https:&#x2F;&#x2F;fred.stlouisfed.org&#x2F;series&#x2F;LES1252881600Q" rel="nofollow">https:&#x2F;&#x2F;fred.stlouisfed.org&#x2F;series&#x2F;LES1252881600Q</a>
  • clickety_clack2 hours ago
    Who is buying things with near-30% APR loan?
    • kevin_thibedeau1 hour ago
      That&#x27;s what a 0% balance transfer is for right? Just play musical cards until the issuers blacklist you.
      • mv41 hour ago
        It&#x27;s never 0% though. You pay a transfer fee (e.g. 5%). The 0% promo period is also limited.<p>The consumer is screwed either way, whether they try to &quot;transfer&quot; balances or not.
        • Grombobulous1 hour ago
          I actually have a no-rewards credit union credit card that has no balance transfer fees and the lowest APR I’ve ever seen on a credit card.<p>It has bailed me out of paying high interest rates and fees during hard times before.
          • rootusrootus26 minutes ago
            I keep a card around like this. I use it once a year so they don&#x27;t close it for inactivity, but it&#x27;s a non-reward card so I don&#x27;t use it day to day. It has a 8.50% APR from two decades ago, so I keep it around just in case. I can&#x27;t really see where I&#x27;d actually need it, but it costs me nothing to keep it around.
        • tialaramex1 hour ago
          That very much depends.<p>Many years ago this &quot;0% transfer&quot; stuff was relatively new in the UK and a new outfit wanted to break into the market, they had two ideas which I guess they had costed as marketing ploys. First, the cards were a weird shape, this means there are a few applications where your card doesn&#x27;t work, which is slightly annoying, but it&#x27;s balanced by the brand recognition. Nobody cares which brand of rectangular plastic card you... oh, that&#x27;s a weird shape.<p>But the Second was the easiest possible 0% transfer. To effect the transfer they write you a cheque for however much they&#x27;d agreed (let&#x27;s say £1000) and you use that cheque to pay off a card or other line of credit. They charge 0% on this for 12 months.<p>What I, and lots of poor but money-savvy people did was sign up for the card. Deposit the cheque in an interet-bearing savings account, and set an alarm to pay the card off before that 0% expired.<p>So twelve months later you&#x27;ve made say £30 interest and you cut the card up. I don&#x27;t know how many people did this, versus how many engaged with their product as they&#x27;d imagined. I know only two things:<p>1. I had about 50p outstanding balance to pay on my 12 month card, I figured they&#x27;d tell me I need to pay 50p within 30 days or whatever and if not they&#x27;d charge me extra - nope, they wrote saying &quot;Your balance is negligible, we write off this tiny balance and don&#x27;t expect to ever hear from you again&quot;.<p>2. This offer was never repeated. They did other 0% transfer offers but the &quot;It&#x27;s just a cheque&quot; idea was never attempted again.
    • bluefirebrand51 minutes ago
      I use a credit card for purchases because if someone gets ahold of it and goes wild, it&#x27;s insured and has a limit<p>If they get ahold of my banking info they could take a lot more than my credit card limit.<p>The damage they can do with my credit card is way, way less.
    • toomuchtodo2 hours ago
      People who cannot afford to survive without this credit and need it to fill the wage expense gap for basic living needs.<p>This is why the unemployment rate is a poor metric. It doesn’t matter much if you have a job if its wages are insufficient for one to meet their basic needs on. Lots of employed folks, but folks barely treading water economically.<p>A silver lining is that with immigration constrained for the foreseeable future, wages will be pushed up over time through structural demographics further tightening labor supply.<p><a href="https:&#x2F;&#x2F;www.marketplace.org&#x2F;story&#x2F;2026&#x2F;08&#x2F;11&#x2F;credit-card-delinquencies-approach-great-recession-levels" rel="nofollow">https:&#x2F;&#x2F;www.marketplace.org&#x2F;story&#x2F;2026&#x2F;08&#x2F;11&#x2F;credit-card-del...</a><p><a href="https:&#x2F;&#x2F;www.marketplace.org&#x2F;episode&#x2F;2026&#x2F;07&#x2F;16&#x2F;workers-are-barely-getting-ahead-in-this-economy" rel="nofollow">https:&#x2F;&#x2F;www.marketplace.org&#x2F;episode&#x2F;2026&#x2F;07&#x2F;16&#x2F;workers-are-b...</a><p><a href="https:&#x2F;&#x2F;news.ycombinator.com&#x2F;item?id=49294240">https:&#x2F;&#x2F;news.ycombinator.com&#x2F;item?id=49294240</a> (citations)<p><a href="https:&#x2F;&#x2F;news.ycombinator.com&#x2F;item?id=49027462">https:&#x2F;&#x2F;news.ycombinator.com&#x2F;item?id=49027462</a> (citations)<p><a href="https:&#x2F;&#x2F;news.ycombinator.com&#x2F;item?id=47680794">https:&#x2F;&#x2F;news.ycombinator.com&#x2F;item?id=47680794</a> (citations)<p>TLDR Wages must go up, price levels will not come down.
    • mapotofu1 hour ago
      Wow look at Mr. “I’ve-never-been-poor”, bragging about his privilege. What a flex!
      • clickety_clack1 hour ago
        You have no idea who I am or what my history is.
      • margalabargala1 hour ago
        Bad take.<p>I&#x27;ve been down to single-digit dollars, in situations where I was forced to choose between food or gas. I also had &quot;never ever have any credit card debt&quot; drilled into me from a young age, and as a result didn&#x27;t even <i>have</i> a credit card at the time to make sure the temptation to use it wasn&#x27;t an option.<p>I ate a lot of ramen, rice, or sometimes nothing, but eventually made it through. If I had racked up a bunch of debt I would have been poor much longer, though it might have been healthier for me.
  • sscaryterry1 hour ago
    When China&#x27;s makes the call on US debt, its going to be very bleak day.
    • panarky1 hour ago
      It would be bleak because the US won&#x27;t pay, and that would crater both the US and China.<p>That&#x27;s why China will never do this.<p>Better for both nations to extend and pretend.
      • sscaryterry1 hour ago
        Yes, you are right, but that doesn&#x27;t mean China doesn&#x27;t have an enormous amount of leverage and influence.<p>With all the grandstanding of the &quot;great&quot; POTUS, I&#x27;m yet to see a material effect of his so called tariffs. All I&#x27;m seeing are home-goals.
      • ecommerceguy1 hour ago
        Are you saying the bond market would go without a bid?
        • panarky1 hour ago
          I&#x27;m saying bond prices would drop sharply if China tried to rapidly sell even 10% of its holdings.<p>When bond prices drop, US interest rates go up, which hurts the real US economy.<p>And when bond prices drop, that devalues the remaining 90% of China&#x27;s holdings, hurting China too.<p>The Fed could stabilize the bond market by printing dollars to buy the bonds itself, but that would devalue the dollar and drive up inflation in the US. When China tries to repatriate that wealth, they must sell dollars and buy yuan, which would drive up the value of the yuan, driving up the cost of Chinese exports, hurting their manufacturing sector.<p>It&#x27;s mutually assured destruction.
          • teravor58 minutes ago
            <p><pre><code> &gt; It&#x27;s mutually assured destruction. </code></pre> it doesn&#x27;t sound like it from what you said. China appears to have the option to destroy the US economy by forfeiting much of the value of the US dollars they have, they don&#x27;t have to buy yuan with it.
            • panarky47 minutes ago
              Both economies would suffer massive shockwaves, but the US has central bank tools to absorb the blow, while China destroys its own asset base with no way to recover the loss. They&#x27;re not going to burn down their own house just to smoke out their neighbor.
          • justin6642 minutes ago
            Just Googling here: 10% of China&#x27;s holdings would be $66B. Daily trading volume for US Treasuries is $1.2T.<p>The most the Fed has ever held on its balance sheet is $5.8T.<p>Maybe I missed a zero somewhere but China&#x27;s sale of 10% of their holdings seems in isolation like an awfully manageable problem. A different discussion if there were a ton of other crazy stuff going on in the world economy and they just piled on, perhaps.
            • weakened_malloc13 minutes ago
              As someone who&#x27;s very well informed on that corner of financial markets.. you&#x27;re absolutely right. 66bn might cause some minor moves in yields but it&#x27;s far from a disaster.<p>US 10y bond auctions are often &gt;40bn in size, with shorter maturities well over that. The seller of this debt (China) wouldn&#x27;t want to smash the market because they&#x27;d only be shooting themselves in the foot.<p>Point being that it&#x27;s an easily digestible amount of debt.
    • spott21 minutes ago
      How would china “make the call on us debt”?<p>That debt is all treasury securities bought on the open market.<p>They can’t demand the US pays them back early any more than you can.
    • weakened_malloc16 minutes ago
      The Chinese (or anyone, for that matter) can&#x27;t just &#x27;call&#x27; US debt. They can either wait for it to mature or sell it to someone else.
    • rootusrootus28 minutes ago
      What are they going to buy instead? And how are they going to sell any significant amount of their holdings without taking a bath themselves?
    • notyourwork1 hour ago
      How does that play out for them? China gets a lot of money from US spending.
      • Johanx6451 minutes ago
        US monopoly money has value mainly because of petro dollar.<p>Once that wraps up, US money will be not much more than toiletpaper.<p>And that is wrapping up because world has like ~60years of oil left at current consumption rates.
        • fragmede29 minutes ago
          As the world moves over to electricity instead of fossil fuels, the petrodollar&#x2F;yuan isn&#x27;t going to matter as much anymore.
    • TechDebtDevin1 hour ago
      [dead]