It is commonly accepted that the U.S. economy relies heavily on consumer spending and consumption. However, if this spending and consumption become excessive, it can pose a threat to the economy.
This issue has recently come to light with the release of the Federal Reserve of New York’s Q2 2024 Household Debt and Credit Report, which revealed that household debt in America has reached $17.8 trillion. This number has sparked concerns about rising debt levels.
John Chang, Senior Vice President at Marcus & Millichap’s National Director for Research and Advisory Services, addressed these concerns in a video titled “Will Elevated Debt Threaten the Economy?” He broke down this high level of debt into different categories:
– $12.9 trillion consists of mortgages and home equity lines of credit
– $1.6 trillion consists of student loans
– $1.6 trillion consists of auto loans
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