Consumer spending is collapsing. This chart is just ugly.
Stimmies are drying up and inflation continues to pressure spending.
Never forget: Consumer spending represents 70% of the economy. pic.twitter.com/tTPeM1fKMp
— QE Infinity (@StealthQE4) June 2, 2024
- Savings Depletion: Many households have been drawing from their savings, which may not be sustainable in the long term. The additional savings accumulated during the pandemic (from stimulus aid and reduced spending on travel, dining out, and entertainment) are nearly depleted.
- Uncertain Future: The post-pandemic economy remains unusual, and predictions about consumer behavior are challenging. While some economists have forecasted the “death of the consumer” and an ensuing recession, the reality is more complex. Consumers appear to be in robust health, but whether spending will cool or collapse remains uncertain1.
- Interest Rates: The durability of consumer spending has caught the attention of the Federal Reserve. Their decision to keep key interest rates unchanged reflects this cautious optimism1.
US Credit Card serious delinquencies of 90+ days reached 7%, the highest level since 2011.
Credit card debt is $1.1 trillion.
Thus, $78 billion of credit card debt is near a default
Consumer has been in THE WORST shape since the Great Financial Crisist.co/PEYgGeZYZn
— Global Markets Investor (@GlobalMktObserv) June 2, 2024
ALERT: Excess savings have now run out
And net saving relative to gross national income is also contracting
This is getting worst by the day for US consumers pic.twitter.com/ca3hTqYfPL
— Game of Trades (@GameofTrades_) June 2, 2024
HAS THE US ECONOMY FALLEN INTO A RECESSION?
Chicago PMI has plummeted to 35.4, the lowest level since the COVID CRISIS.
It has been in contraction for 6 consecutive months.
In the past, such a level HAS ALWAYS occurred when the US economy was going through a recession. pic.twitter.com/zcs1fx9UrR
— Global Markets Investor (@GlobalMktObserv) June 3, 2024