Nearly half of student loan borrowers expect to go delinquent when payments resume next month (from Joe Consorti via X on August 28)…
45% of student loan borrowers expect to go delinquent when payments resume on October 1st. That’s not good.
Consumer
Consumer spending appears to have weakened significantly in August (from Bob Elliot via X on September 6)…
Bunch of data points suggest a substantial weakening in consumer spending in August. If the consumer is actually fading, very hard for equities to hold these levels. Morgan Stanley, Chase, and Citi retail sales trackers all weakened a lot in Aug. Short thread. Chase credit card spending tracker also showing some weakness: h/t @Econ_Parker This
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Wage growth isn’t falling for high earners, which could explain some of the unexpected resilience in consumer spending this year (from Liz Ann Sonders via X on September 8)…
As tracked by Atlanta Fed, much of slowdown in wage growth has been concentrated in lowest-earning quartile (blue)… highest-earning quartile (orange) has seen growth roll over but barely.
Data suggest many households started running into financial trouble this summer (from Liz Ann Sonders via X on September 12)..
As of August, massive uptick in % of households saying they’re much worse off vs. a year ago (blue) per NY Fed Survey of Consumer Expectations
Student loan repayments could create a $100 billion hit to consumer spending (from The Wall Street Journal on September 16)…
The restart of student-loan payments could divert up to $100 billion from Americans’ pockets over the coming year, leaving consumers squeezed and some of the nation’s largest retailers fearing a spending slowdown. Starting Oct. 1, tens of millions of student-loan borrowers will need to make payments averaging between $200 and $300 each month. The payments
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Default rates on credit card debt from small lenders are already higher than prior crisis peaks (from Game of Trades via X on September 21)…
Default rate on credit card loans from small lenders has now surpassed the highs of: – Dot Com bubble – Financial Crisis – Pandemic This won’t end well
Credit card losses are rising at the fastest pace since 2009 (from CNBC on September 22)…
Credit card companies are racking up losses at the fastest pace in almost 30 years, outside of the Great Financial Crisis, according to Goldman Sachs. Credit card losses bottomed in September 2021, and while initial increases were likely reversals from stimulus, they have been rapidly rising since the first quarter of 2022. Since that time,
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Two notable retailers issued significant warnings about consumer spending this month (from The Wall Street Journal on August 22)…
Dick’s Sporting Goods and Macy’s shares traded sharply lower Tuesday after the retailers posted weaker quarterly earnings and provided tepid forecasts for the remainder of the year, signals that the recent strength in consumer spending has its limits. The sporting-goods chain slashed its profit targets for the year after missing Wall Street forecasts for the
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This month brought more “ominous” signs for the auto loan industry (from The Wall Street Journal on August 21)…
Five years ago, there were a dozen models of new cars that sold for less than $20,000. In 2023, there was only one: the spartan Mitsubishi Mirage hatchback, which accounted for about 5,300 of the 7.7 million new vehicles sold in the U.S. in the first half of the year. If you are willing to
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