US economy turning?

Doug Henwood dhenwood at panix.com
Thu Jan 3 11:07:29 PST 2002


Jordan Hayes wrote:


>I wonder whether this is really that people are piling on debt or
>whether the sheer number of people who have access to credit isn't
>skewing these numbers.

I think it's probably both, but I haven't seen a breakdown lately. I think debts are higher at all income levels - though the subprimes are not big enough to drive the averages up much.

The WSJ had an article last week on how even geezers are piling on the debt.


>If Citicorp sees too many defaults on their credit cards, they
>should blame the business head for being unprofitable, not "the
>consumer" for being imprudent.

But they want to have their cake, eat it, & send you the bill!


>Back to mortgages: home ownership is also at an all-time high; isn't
>that because in the past there were large groups of people who were
>technically "creditworthy" (i.e., could financially handle the
>servicing of a mortgage) but were still unable to secure mortgages for
>reasons like not having enough of a down payment to qualify or being
>redlined? Now if Fair Issac and Fannie Mae say you can buy a house,
>you can. That's got to be a big step forward in society.

There were a lot of no-money-down and 5% down mortages written during the Clinton years. Boosts the homeownership numbers, but if the recession lingers...

Doug



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