- Oct 10, 2003
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From and article on MSNBC.COM
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The numbers reveal the plight
Consider these statistics from Demos, a nonpartisan and nonprofit public policy research and advocacy group in New York.
Between 1993 and 2000, the credit card industry tripled the amount of credit it offered to customers, from $777 billion to almost $3 trillion.
The average card-holding household now has six credit cards with an average credit line of $3,500 on each, for a total of $21,000 in available credit.
This massive marketing and extension of credit lines has led to a big jump in consumer credit card debt. Whether out of temptation or financial necessity, many Americans have run up big balances on their supersized credit lines.
Estimates vary, but the Federal Reserve Board estimates that the average household has $8,000 in revolving debt, most of it in credit cards.
"These balances are unmanageable for families struggling to make ends meet," says Heather McGhee, a program associate at Demos. "We talk to families all the time with $40,000 to $50,000 of credit card debt, and they'll be paying off credit cards through retirement."
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Thats alot of credit limit out there, and it sounds like many Americans used it in the 90's....things are bad now but could be worse when the fed eventually raises rates back up...imagine having 10000 dollars on a card with 4 percent rate going to 12 or 15 percent or higher...the monthly payment could be come unaffordable.
One has to wonder how much of the booming 90s was financed on credit, and now the chicken has come home to roost
Is it possible people aren't spending because their credit cards are maxed out?
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The numbers reveal the plight
Consider these statistics from Demos, a nonpartisan and nonprofit public policy research and advocacy group in New York.
Between 1993 and 2000, the credit card industry tripled the amount of credit it offered to customers, from $777 billion to almost $3 trillion.
The average card-holding household now has six credit cards with an average credit line of $3,500 on each, for a total of $21,000 in available credit.
This massive marketing and extension of credit lines has led to a big jump in consumer credit card debt. Whether out of temptation or financial necessity, many Americans have run up big balances on their supersized credit lines.
Estimates vary, but the Federal Reserve Board estimates that the average household has $8,000 in revolving debt, most of it in credit cards.
"These balances are unmanageable for families struggling to make ends meet," says Heather McGhee, a program associate at Demos. "We talk to families all the time with $40,000 to $50,000 of credit card debt, and they'll be paying off credit cards through retirement."
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Thats alot of credit limit out there, and it sounds like many Americans used it in the 90's....things are bad now but could be worse when the fed eventually raises rates back up...imagine having 10000 dollars on a card with 4 percent rate going to 12 or 15 percent or higher...the monthly payment could be come unaffordable.
One has to wonder how much of the booming 90s was financed on credit, and now the chicken has come home to roost
Is it possible people aren't spending because their credit cards are maxed out?
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