America poor as credit card balances top $1.08 trillion with many more Americans falling below the poverty line under Biden
The Financial Times reported on Monday that a majority of US voters are dissatisfied with President Joe Biden’s economic policies, according to the latest monthly poll conducted by the Global Strategy Group and North Star Opinion Research.
According to the findings, some 61% of respondents said they disapproved of Biden’s handling of the economy, while only 36% approved.
Nearly 70% claimed that Biden’s economic policies have either hurt the American economy or had no impact on it. Some 33% stressed that the president’s actions have “hurt the economy a lot.” Just 26% saw Biden’s policies as beneficial, while only 14% believe their finances have improved since the president took office.
Some 82% of respondents stated that they were especially worried about rising prices and the failure of the current administration to deal with the problem. US inflation has dropped from last year’s peak of 9.1%, but was still well above the 2% target at 3.7% year-on-year in September. Some 75% of those polled named inflation as the greatest threat to the US economy in the next six months.
“Every group – Democrats, Republicans and independents – list rising prices as by far the biggest economic threat… and the biggest source of financial stress. That is bad news for Biden, and the more so considering how little he can do to reverse the perception of prices before election day,” Erik Gordon, a professor at Michigan’s Ross School, told the FT.
Getty Images / Marat Musabirov
Of the respondents, 52% said they had cut spending on food or other everyday necessities due to higher prices, while some 65% were forced to slash non-essential spending on things such as holidays or eating out.
The poll was conducted online between November 2 and 7 among 1,004 registered voters nationwide.
US credit card debt continued to surge in July-September this year, marking the eighth consecutive quarter of year-over-year increases, economists at the New York Federal Reserve bank said in a report last week.
According to their calculations, credit card balances increased by $48 billion (4.7%) from the previous three months and by $154 billion on an annual basis, the highest increase since records began in 1999. This brought the total outstanding credit card debt to a new record high of $1.08 trillion.
Meanwhile, mortgage balances also surged to $12.14 trillion, while student loan and auto loan balances rose to $1.6 trillion each.
Total household debt grew by $228 billion during the reporting period, largely due to credit cards and student loans, and reached $17.29 trillion.
Researchers noted that more and more households were having difficulty managing their debt amid persistently high inflation and rising interest rates. For instance, nearly 9.5% of credit card balances were more than 90 days delinquent in the reporting period, the report said, up from 8% in the second quarter.
“The increase in balances is consistent with strong nominal spending and real GDP growth over the same time frame. But credit card delinquencies continue to rise from their historical lows seen during the pandemic,” researchers from the New York Fed said in a statement that accompanied the data.
“The transition rate into delinquency remains below the pre-pandemic level for mortgages, which comprise the largest share of household debt, but auto loan and credit card delinquencies have surpassed pre-pandemic levels and continue to rise.”
The researchers noted that the spike in households transitioning into delinquency was “surprising” given the relative stability of the US economy and labor market. While the trend could stem from changes in lending standards, it could also signal “real financial stress,” they concluded.
Source RT/X/Financial Times