Debt delinquency rates are normalizing

[Silver Ridge Market Report Logo] [Privacy Policy]( | [Advertiser Disclosure]( Dear Reader, Consumer debt delinquency rates continue to normalize from historically low levels. From the New York Fed’s Q4 2022 Household Debt and Credit report: …As of December, 2.5% of outstanding debt was in some stage of delinquency, 2.2 percentage points lower than last quarter of 2019, just before the COVID-19 pandemic hit the United States. The share of debt newly transitioning into delinquency increased for nearly all debt types, following two years of historically low delinquency transitions. Transition rates into early delinquency for credit cards and auto loans increased by 0.6 and 0.4 percentage points, following similarly sized increases in the second and third quarters. Delinquency transition rates for mortgages upticked by 0.15 percentage points. Those for student loans have remained flat, as the federal repayment pause remains in place… Credit card debt trends have been of particular interest in recent months, as they tell us much about the health of consumer spending, which accounts for about 70% of GDP. According to the NY Fed data, credit card balances increased by $61 billion to reach $986 billion during Q4, which is above the pre-pandemic high of $927 billion. With the aggregate credit limit at $4.4 trillion, however, consumers are far from maxing out their cards. Consumers are carrying $986 billion in credit card debt. (Source: NY Fed) Taking a closer look at demographics, NY Fed researchers observed delinquency rates for younger borrowers above pre-pandemic levels, while delinquency rates remained low for older borrowers. Keep in mind that we’re living in a regime where the Federal Reserve is actively increasing interest rates in its deliberate effort to bring down inflation by slowing demand. So, rising debt delinquency rates are the intended effect of tight monetary policy. That said, consumer finances remain very strong with high cash balances, excess savings, and relatively low debt service ratios. This financial flexibility continues to enable robust spending. Nevertheless, the trends are worth watching. Editor, Silver Ridge Market Report Andrew Graham [A Graham Signature] [Privacy Policy]( | [Advertiser Disclosure]( P.S. [What is the best thing you can do when the markets keep dropping?]( This is what renowned analyst and FOX host, Charles Payne, wants to teach you... So he's revealing everything you need to know in his new [Free Live Event Series]( Wednesdays @ 7:00 PM EST. Click below to register for this free training event, and learn how you can navigate 2023 with more confidence than ever. [Click here to register now]( [Privacy Policy]( | [Advertiser Disclosure]( 406 Media and Silver Ridge Market Report, is not giving individualized financial advice. Never invest more than you are willing to lose. 406 Media or Silver Ridge Market Report is not giving financial, investment, or stock advice. Our content is designed for generalized informational purposes only. If you have specific questions about investments or stocks you should consult a financial advisor. Articles, News, Or Other published materials are not always the views of 406 Media and/or Silver Ridge Market Report. If you feel you are receiving these emails in error please email Support@SilverRidgePro.com or click the unsubscribe button below. 30 N Gould St, STE R, Sheridan WY 82801 This e-mail has been sent to {EMAIL}, [click here to unsubscribe](.