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Showing posts with the label consumer spending

Consumer Driven Economy | Is The Average Person Priced Out Of The Market

 ðŸ§© The actual situation (by category) 1) Auto loans & negative equity ~ 29% of trade-ins have negative equity Average negative equity: ~$7,200 (many >$10k) Total auto debt: ~$1.65–1.67 trillion What it means: People are rolling old debt into new loans → “permanent car payments” This is a cash flow trap , not a banking crisis (yet) It reduces future consumption because income is already committed 👉 Risk level: Moderate, but corrosive over time 2) Mortgage stress (FHA / lower-income borrowers) Overall mortgage delinquency still relatively low (~1–4%) BUT: Sharp rise in lower-income / FHA borrowers FHA delinquency rates materially higher than conventional loans rising delinquency rates concentration in financially weaker households What it means: This is not 2008 (no widespread housing collapse) It is a stress signal at the margin , especially for first-time buyers 👉 Risk level: Contained, but a leading indicator 3) Stu...