Credit Card and Auto Loan Defaults Hit 2008 Levels as Credit Card Debt Soars to Record $1.08 Trillion, Signaling An Imminent Financial Crisis

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Credit Card Debt Climbs: 56 Million Americans in Prolonged Debt Amid Economic Pressures

The credit card debt situation in the U.S. is becoming increasingly concerning, with a record $1.08 trillion in balances as reported by the Federal Reserve Bank of New York. Ted Rossman, a senior analyst at Bankrate, highlights a staggering 40% rise in credit card balances over the past two years. Notably, nearly half of all cardholders are now carrying their debt month-to-month, a significant increase from last year. This shift indicates growing financial strain, as 56 million Americans have been in credit card debt for over a year. Factors contributing to this trend include inflation, higher borrowing costs, and possibly shifts in lending practices. The Fed researchers suggest that this could be a sign of deeper economic distress.

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