Credit card companies shut down 8 million credit card accounts in February while accepting more Bailout Credit Cards from the U.S. Treasury. 400 Million Credit Card Accounts still open.
Many American households have been strapped for money for many years. The benefit of having a debt bubble is the ability to cover up troubling economic trends and drown out any noise while people feed at the bubble. During this time, credit was easily accessible and many families used credit cards as a bridge loan to hold them over for another month. That lifeline is becoming more and more limited. That is why we are seeing bankruptcies jumping sky high in the latest filings with U.S. courts. In news that will make life harder for more on the edge, credit card companies pulled 8 million credit card accounts in February. The peak number of credit cards was reached in July of 2008 at 483 million. The current number of credit card accounts open is 400 million.
24 Million Americans Unemployed or Working Part-time but Available for Full-time Work. Why This Recession Feels Much Worse to Average Americans.
During the height of the Great Depression in 1933 with unemployment hitting its peak, 13 million Americans found themselves out of a job. This translated to 1 out of every 4 workers in the civilian labor force. You may be wondering how is it that we have recently heard rumblings that this recession may have bad elements similar to the Great Depression? After all, the current headline unemployment rate is only 8.5 percent. The truth of the matter is the unemployment situation is much worse. If we add up all the unemployed, those working part-time but are looking for full-time work, and those who have given up looking for work we would find that over 24 million Americans are out of work or under employed. 25 out of every 100 workers during the Great Depression. Currently 15 out of every 100 workers in our current recession.
Employment a Lagging Indicator? Not Always. Using Outdated Economic Data and Trends for Future Financial Models. Just Because Stocks Rebound doesn’t Mean the Fundamentals are Good.
The markets are continuing on an unrelenting upward movement since their March 9th lows. This is a strong rally that has now seen the S&P 500 jump up by 25 percent in the matter of a few weeks! This kind of market volatility is reserved for highly volatile and troubled markets. It is a rare occurrence to see this kind of quick burst to the upside in more stable and solid bull markets. In addition, the rally is being spurred on by “not so bad” news while the core economic fundamentals are still horrible. Take unemployment for example. This is probably the best indicator of how people and families “feel” the actual recession. The fact that the market is now up 25 percent does very little for the average American family.
Saving Money is Bad for the Economy: Personal Savings Rate Higher, Consumption Slightly Up, Banks get new American Express, and Markets Begging for Money.
Last month the savings rate hit the 5 percent mark. That makes two months over 4 percent and for the first time in a decade that Americans have actually saved more than 4 percent for two consecutive months. Saved 4 percent of what? Of their personal income. You would think that most people would be saving a little bit of money but that has not been the case. The average American household does not make as much as the media once portrayed. This fact is hard to reconcile when our eyes see brand new cars and clothes on virtually every person we come into contact. Yet the fact of the matter is the large majority of these people have those new shiny artifacts because of debt. Let us take a look at the savings rate and consumption over the past two decades: