In the intricate web of economic indicators, the perils of relying on averages come to light, exposing the stark reality of worsening inequality. Beyond the glossy surface of seemingly prosperous financial landscapes, a deeper dive into individual income data reveals a challenging narrative for the bottom 80 percent.
This is a typical pitfall of "averages". You need to look at the data individually by income. The bottom 80 percent of income have a harder time for money. This is also related to wealth inequality. t.co/QfR1dJOoNV
— HuDalio (@HoonyKim0214) December 19, 2023
Bank of America’s assertion that credit card delinquencies are on the rise is a somber note in the symphony of economic statistics. While, on average, households may boast flush liquid assets, the truth lies in the nuanced story of individual struggles within the lower income brackets. This narrative is intimately tied to the overarching issue of wealth inequality.
"Although credit card delinquencies have risen sharply, households on average remain flush with liquid assets."
– BofA pic.twitter.com/1W5UjJP37u
— Daily Chartbook (@dailychartbook) December 19, 2023
Recent data from TransUnion paints a concerning picture, indicating that credit card balances in the U.S. have soared to a 10-year high, registering at $6,088—a notable 15% increase from the previous year. The ramifications of this trend echo the financial challenges faced by a significant portion of the population.
Credit card balances in the U.S. have reached a 10-year high, carrying a balance of $6,088, up 15% from this time last year. per TransUnion.
— unusual_whales (@unusual_whales) December 19, 2023
The LendingClub study sheds light on the depth of the problem. In December, a staggering 62% of adults reported living paycheck to paycheck, a notable increase from 58% in March. Surprisingly, 40% of consumers facing financial precarity with a paycheck-to-paycheck lifestyle boast super-prime credit scores, challenging the conventional link between creditworthiness and financial stability. Furthermore, a noteworthy 57% of credit card owners experience the cycle of living paycheck to paycheck, highlighting the widespread nature of this economic challenge.
The disconnect between economic policies and the lived experiences of citizens is glaring, as reflected in polling data indicating that only 14% of voters believe Biden’s economic policies have benefited them. A striking 85% express the belief that these policies have either harmed them or made no discernible difference.
As credit card balances surge and economic discontent simmers, the call for a more nuanced understanding of inequality becomes imperative. Addressing the root causes of financial instability and bridging the gap between policy promises and their tangible impact on average Americans are critical steps toward building a more equitable economic landscape.