Foreboding Data, Second Quarter Credit Card Balances Jump 13 Percent, Largest Increase in Twenty Years

It’s not just the scale of the increase that is surprising; it’s the history of how long it has been since this scale of debt increase happened in a single quarter.

(CNBC) – […] Although average hourly earnings are up 5.1% from a year ago, prices have been rising much faster. The Consumer Price Index, which measures the average change in prices for consumer goods and services, jumped a higher-than-expected 9.1% in June, the fastest pace in over four decades.

To bridge the gap, more consumers are relying on credit cards to get by, which has helped propel total credit card debt to $890 billion.

Overall, credit card balances rose 13% in the second quarter of 2022, notching the largest year-over-year increase in more than 20 years, according to a report from the Federal Reserve Bank of New York. (read more)

This doesn’t sound like a good economic omen.