Debt Free News

Report to release damaging info regarding consumer debt

January 6, 2007

According to one major consumer debt watchdog, there are some damaging things happening in the US regarding debt. Our debt free article patrons will want to pay close attention to this compelling news article.

It is being reported that that some three hundred billion dollars of consumer spending has already disappeared in the US. Consumer spending is down by this amazingly large number. Is this major effect taking place due to the decline in mortgage equity? Our debt free news department certainly believes that it has a lot to do with it – but not the only reason.

Now, if you have read most of our information on this debt free website regarding debt, consumer debt issues, credit card debt and more, you know that this number being reported cannot be ignored. Seriously, the US economy is not dynamic enough to be able to brush this under the table. As we tell our debt article readers all the time – this affects you.

While many economists and those in the know regarding consumer debt ands spending, the clear and present slow in the real estate market (except to really expensive real estate that is) we will witness a recession of some sort soon. Even so, the Federal Reserve wants this to certainly not happen.

What’s more, it is being reported that things in the world of debt and consumer spending are worse than just a measly $300 billion slide. This si a very controversial statement and it is being rebuffed by many debt and consumer spending advocates.

While in fact, the latest consumer economic statistics are showing that US consumers counted on new debt for ninety percent of their cash flow during the last year – and the year before that another huge amount of new consumer cash flow came from debt – eighty eight percent to be exact.

Here in our debt free news reporting department at DebtFree24.com, we believe that we are witnessing a monthly cash flow pattern that implies consumer debt service levels have become higher than they need to be. See, this actually means that consumers did not have enough money to make the monthly payments on anything new due to the fact that every last bit of their income of income is being dedicated to service the on hand debt. If so, this means more consumers are dipping into the old retirement fund – if they have one that is.

This angers many debt and consumer advocates because rates are historically high and getting higher and many fat cat CEOs at lending companies are parlaying these earnings into fattening their wallets while consumers cannot get out of debt or become debt free – heck they cannot even afford a debt consolidation offer because the rates are not great there either – many consumers have been forced to make late payments on existing debt and because of this the rates they are offered to consolidate are not great.

So, are we headed for a recession? Many consumers will tell you yes. The other shoe has to drop and it will drop soon. The backlash will hopefully not obliterate many consumers’ chances at getting out of debt. Judging by the way US consumers spent during the holidays – it is not looking that great. Maybe the retail market was boosted – but it will suffer when people cannot pay their monthly payments and credit card debt off on time. What is the resolution? Better consumer spending education to begin would be in order. These reports are disturbing and we hope you are reading.

(598)