How indebted are we?

God bless the Fed, they release scores of negative information and still have the balls to mask the data publicly. Consider the following releases regarding consumer debt.

"The household debt service ratio (DSR) is an estimate of the ratio of debt payments to disposable personal income. Debt payments consist of the estimated required payments on outstanding mortgage and consumer debt. "

"The financial obligations ratio (FOR) adds automobile lease payments, rental payments on tenant-occupied property, homeowners' insurance, and property tax payments to the debt service ratio."

That means "Joe Shmoe" is spending almost 20% of his income to provide himself with security, an increase of close to 20% since 1980. And next...the grand finale.



Just feast your eyes on that mother. Disclosure isn't as easy to come by on this one. Did I calculate this right an 877% increase from 1980 to Q3 of 2007! refer to Economagic: Household Credit Market Debt Outstanding to see the raw data I used for my calculation. It appears as though the de-leveraging consumers are facing is much much worse than I anticipated. The next question on my mind...has personal income risen proportionally to this astronomical level of outstanding household debt? I fear not, but stay tuned.

Household Debt

StLouisFed/Fred/HouseholdSector