- American credit card debt hit $1 trillion this year, surpassing 2008 crisis highs.
- Delinquencies are at four-year highs, while delinquencies at small banks hit record rates.
- Credit card interest rates are at all-time highs, making it harder than ever to pay back.
There are “bubbles everywhere” according to Nobel prize winner Robert Shiller, from stocks to bonds to the housing market. But add another one to the list: credit cards.
American credit card debt now stands at $1 trillion – nominally higher than during the 2008 crisis. And delinquencies are rising. At small banks, the delinquency rate is now worse than 2008.
As for interest rates? They’re at all-time highs. This isn’t a crisis yet, but it’s an unsustainable trend. A bubble waiting for a pin.
Record levels of nominal credit card debt
Household credit card debt recently hit $1 trillion. It’s the fastest-rising household debt, outstripping the pace of auto loans or student loans. By the New York Federal Reserve’s own admission, we’re back at 2008 figures.