Friday, February 16, 2024

Who Do You Owe?

 Debt, Prices & Credit:

The U.S. Blue Collar Recession

  1. Auto loan debt: $1.607 Trillion - Q4/2023

  2. Avg. auto loan outstanding: $23,809 - Q3/2023

  3. Avg. New Pickup Truck price: $60,000 - Q3/2023

  4. Avg. New Car price: $49,388 - Q2/2023

  5. Median U.S. House price: $387,600 - Q4/2023

  6. Mortgage debt: $12.252 Trillion - Q4/2023

  7. Derivatives held on Wall Street & elsewhere: $268 Trillion - Q3/2023

  8. Student debt: $1.601 Trillion - Q4/2023

  9. Credit Card debt: $1.129 Trillion - Q4/2023

  10. Total household debt: $17.3 Trillion - Q3/2023

  11. U.S. Government debt: $34.233 Trillion - February 14, 2024

  12. U.S. Corporate debt: $3.1 Trillion - Q3/2022

  13. Medical Debt: $220 Billion, Q4/2021 - 22% over $5,000 2023

  14. Avg. insurance price for houses: $1,678 yr. - Feb, 2024

  15. Avg. insurance price for cars: $1,982 yr. - Feb. 2024

  16. Avg. Rent: $1,372 mth. - Q2/2023

  17. Median House Price: $417,700 - Q4/2023

  18. Home Foreclosures: Up 9% from 2022, up 193% from 2021

  19. Commercial property foreclosures: Data? A 'bad outlook.'

  20. Car Debt Delinquent: 7.7% - Q4 /2023

  21. Car repossessions: Up 20.4% - Q4/2023

  22. Credit Card Debt Delinquent: 8.5% - Q4/2023

  23. Commercial Chap. 11 Bankruptcies: 6,569 - Q4/2023

  24. Personal Bankruptcies: 419,550 – Q4/2023

The Debt Bomb

Note the number of derivative debts and bets – 10 times larger than the whole world GDP economy. This is also part of the 'Snowball' crash in the Chinese stock markets, the shadow banking shortfalls, as well as the severe real estate recession in China.  This is a crisis for the large capitalist sector in the Chinese economy.  The Snowball crash is explained by Ellen Brown in Scheerpost: Chinese Market Crash  5 large investment banks hold most of these derivative bets here in the U.S. according to Wall Street on Parade.

Even buying a new car now is prohibitive, and that has always been a key 'American right.' Nearly all of these numbers are at all time highs except house prices, which have fallen in some areas due to high interest and insurance rates. Government CoVid and recession funding slowed debts like medical and student for awhile. Some figures are delayed or hidden. Yet now trying to buy a new or used car, rent, buy a house or get sick is going up again. The debt levels on some items will never be re-paid – like derivatives, federal, corporate debt or even mortgage, credit card, medical and student debt. I suspect the 'corporate debt' figure is a great undercount.  It all adds up to a very shaky capitalist economic structure, but also a vast burden on the working class in all its aspects – the low-skilled, youth, minorities, women, old people. This can't be fixed by some patchwork legislation or tweaks. Debt is how workers have afforded to buy things in the U.S. - but this kind of spending has limits beyond which capital has no plan except immiseration.  

Michael Roberts has pointed out that 'debt,' speculation and recession are signs that the ordinary profit rate based on exploiting labor is not enough to float the capitalists.  In other words profits are falling right now.

So ... open the books, social control of the Federal Reserve, cancel debts, nationalize the banks, outlaw derivatives, social ownership of land, introduce a real 'sharing' economy, limit and control interest rates, free education, public ownership of housing, bring back Glass-Steagall, revoke Taft-Hartley and CFMA 2000, fight climate change through transitional steps towards full social control of production.

Sources: Investopedia, Federal Reserve, Wall Street on Parade, Cars.com, Kelly Blue Book, BLS, Federal Debt Clock, Bankrate, Moodys, Reuters, Guardian, Statistica, Car Price.com, Petersen Study on Health Care.

Prior blog reviews on this subject, use blog search box, upper left, to investigate our 17 year archive, using these terms: “The Debt System,” “Debt & Capital,” “Debt – the First 5,000 Years” (Graeber); “The Debt Trap,” “J is for Junk Economics” (Hudson); “Modern De Facto Slavery,” “The Deficit Myth”(Kelton); “Liar's Poker” (M. Lewis); “Bad Money” (K. Phillips).

Red Frog

February 16, 2024

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