U.S. consumer credit-card debt just passed an ominous milestone, beating a record set just before the global financial system almost collapsed in 2008.
Outstanding card loans reached $1.02 trillion in June, data from the Federal Reserve show, as lenders including Citigroup Inc. and JPMorgan Chase & Co. compete to sign up cardholders who may carry balances — a relatively lucrative business in a prolonged period of low interest rates…
In 2008, a drop in home prices spiraled into a global financial meltdown, and after the jobless rate surged toward 10 percent, banks wrote off more than $100 billion in credit-card loans over the next two years.
I am always on the lookout for objective proxies that can be used to measure amygdala, in the hopes they can one day be used to predict what is coming. All of the K-shift is merely amygdala coming online, so anything which is activating that amygdala and exercising it, is probably driving the overall psychology toward K.
Credit card debt is probably a good measure of societal stress, which will itself build amygdala. If people are building that credit card debt, they are initially enjoying the dopamine from the resource expenditure. But as that debt builds, then comes the stress and the sinecure lifestyle which will produce K. The higher the debt goes, the more the K is building. And the more the K is building in a period of r, the more the sudden switch to K is likely to hit, and trigger a collapse of the euphoria that fuels the silliness and irresponsibility of r.
It isn’t black and white, or a simple one-facet measure, since debt mixes the pleasure of spending with the stress of shortage. But paying off credit card debt will tend to occur due to increasing resource availability (and that will increase r), or it can be due to K-increasing sufficiently enough to drive a more forward-looking psychology that prioritizes responsibility over pleasure. But even that will produce increased security and that increased security will also fuel r.
So as the Trump economic boom takes off, that high debt can probably exist with a higher level of resource availability that will r-ify the population somewhat, but that increasing r will tend to accompany a diminishing credit card debt if the boom is sufficient to be an Apocalypse killer. Likewise, if the society K-ifies enough, then it will pay off the credit card debt, and that will r-ifiy the populace as well. But in both cases, that debt being paid off will indicate increasing r, either due to freer resource availability due to the environment changing, or due to the psychology being sufficiently K enough to allow some relief from the strain – and consequent shift toward r.
So diminishing credit card debt is probably a sign of increasing r, while increasing credit card debt is a sign of increasing K. When you have record credit card debt (which makes it difficult to pay down), and it is still increasing, I would assume that is a sign of peak r’s approach, and a sudden K-shift at some point.
I watch for this, because once that K is triggered, it will manifest everywhere else as well, from stock market investment, to loaning money, to triggering wars and changing the social aspects of society. It could, if everything is precarious enough, trigger Apocalypse.
What we have here is another sign of the approaching shift. We are seeing little signs of it here and there, but this would indicate the big shift is still on its way, and given all the interlinked weak points, it may be a doozy.
Truth be told, we need it.
Spread r/K Theory, because the collapse may be around the corner
[…] Credit Card Debt At Record High […]
I would postulate that card debt is “r” and that K doesn’t run up debt. It may indicate that r is running out of free everything so the card gets hit to assuage the amalgada.
it is the last step before homelessness. and the apocalypse.
western countries are mostly ruled by r types and they are lying and hiding the danger both because they are r types and they want the party to continue. since we are on the vertical part of the parabolic it wont be long. only so many ways to screw the pooch and they are close to all being exhausted.
Why does debt of any sort matter anymore? You’ll either pay it off or you won’t, in which case the Federal Reserve will just buy the debt with freshly printed money and forgive it.
Central Banks can easily forestall any move toward K by printing money, right up to the point where that money becomes worthless and the rabbits become dinner.
You’ve got to measure the slope of that curve per unit time and adjusted for population growth it seems at 2000 levels. What that curve doesn’t show you is that Americans are buying smaller, cheaper homes and consuming less, on average. That dip you see after 2008 represents some pretty serious bankruptcies. That number could go 50% higher easily- which is about middle of next decade for a blow-off. It could keep on going if Millennials aren’t buying houses and having fewer/no children they can easily spend more on other things. Student loans also impact Millennials much more than past generations, Millennials should of passed Baby Boomers as the prime consumer cohort in 2014 based off of normal demographic history but, as of yet Boomers are still spending more. They’re cashing out of real estate while it still has value. If Millennials don’t start raising families in the next 10 years or so, they’re not going to- the problem is that young people loaded with debt don’t typically start families. Also look at the bigger trend on that curve, it started up in 1971, it’s the dollar fiat bubble. Lord knows what happens when it pops.