(My new American Thinker post)
We've discussed the impact of gasoline and food prices on the family budget. It's complicated, but we may be seeing the impact or a rise in delinquencies. This is the story:
More Americans are falling behind on their car loan and credit card payments than at any time in more than a decade, a troubling signal of consumer stress as higher prices and rising borrowing costs are squeezing household budgets.
The pain is most acute for lower-income earners, who have largely used whatever they managed to save during the pandemic with the help of government stimulus checks and breaks on obligations such as rent and student loans.
“The increase in delinquencies and defaults is symptomatic of the tough decisions that these households are having to make right now -- whether to pay their credit card bills, their rent or buy groceries,” said Mark Zandi, chief economist at Moody’s Analytics.
It's tough out there, as they used to say back in the early 1980s when inflation and interest rates buried consumers.
The real problem is gasoline, because it forces so many things to go up, i.e. we use fossil-fuel-powered trucks to move goods and services.
As the article points, there is not enough money left in the bank account after you pay the rent, food, and other basics. In other words, there is no cash left when the car or card payment comes up. It's reality in most homes.
This is also from the story:
Another red flag: Shoppers are turning to buy now, pay later services to cover necessities such as groceries. Usage surged 40 percent in the first two months of 2023, according to data from Adobe Analytics.
How do we fix this? We can't quickly, but bringing down the price of gasoline would help a lot.
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