The U.S. consumer credit picture continues to look grim as 2018 is coming into the end of its first quarter. Despite economic performance across the economy that is nearly universally described as strong, overdue credit card debt has hit a seven-year high.
According to sector data, consumers more than three months behind on their bills or considered otherwise in distress were behind on nearly $12 billion in credit card debt as of the beginning of the year — an 11.5 percent increase during Q4 alone.
And it’s not just the credit card debt — mortgage problem debt is up as well, 5.2 percent to $56.7 billion.
On the upside, commercial and industrial loans are looking strong, with only 8.5 percent falling into the problematic category.
The numbers come care of the FCIC, and add to the growing pile of concerns about the consistency of the often-touted economic growth. The theory, as explained by The Financial Times, is that middle American consumers are being routinely missed by the rising economic tide and are increasingly relying on credit cards to get by.
Others note that the big debt increase flows from an issuing boom that saw banks working actively to pursue consumers with rich benefits, which has led to card use described by David Rosenberg, chief economist at Gluskin Sheff, as “absolutely epic.”