The Consumer Grows Weaker
The New York Fed released its Q2 Household Debt and Credit Report (HERE).
The table that we put together highlights the rate of change as it relates to flow into serious delinquency.
Mortgage Debt serious delinquency is up 51% y-o-y; Credit Card Debt serious delinquency is up 41%; and Auto Loan Debt serious delinquency is up 20%.
You can see those spikes visually depicted in the charts published by the Fed (below).
As we have said since 2022, the Consumer is getting weaker given that absolute price levels have dramatically increased since 2020 (whether one refers to CPI or better yet, real-world pricing). It is irrelevant that price increases have started to slow. The problem for the consumer is that absolute prices remain high relative to 2020. Elevated price levels are dragging the consumer and the U.S. Economy down.
