{"id":1450628,"date":"2024-01-15T00:50:00","date_gmt":"2024-01-15T05:50:00","guid":{"rendered":"https:\/\/bugaluu.com\/news\/?p=1450628"},"modified":"2024-01-15T00:50:00","modified_gmt":"2024-01-15T05:50:00","slug":"debt-saddled-consumers-embracing-even-more-doom-spending","status":"publish","type":"post","link":"https:\/\/bugaluu.com\/news\/debt-saddled-consumers-embracing-even-more-doom-spending\/1450628\/","title":{"rendered":"Debt-Saddled Consumers Embracing Even More “Doom Spending”"},"content":{"rendered":"

Debt-Saddled Consumers Embracing Even More “Doom Spending”<\/span><\/p>\n

\n

Via SchiffGold.com,<\/em><\/a><\/p>\n

In a disturbing (but unsurprising) trend,\u00a0more than 1 out of 4 US consumers are throwing in the towel with defeatist \u201cDoom Spending\u201d sprees<\/a>\u00a0\u2014 despite already being saddled with crippling levels of debt.<\/strong> This behavior is akin to someone who, feeling overwhelmed, indulges excessively in a habit they know isn\u2019t beneficial. In a similar vein, these Americans, perhaps feeling a sense of despair, are accumulating unprecedented levels of new debt through spending sprees that are beyond their financial means.<\/p>\n

<\/a><\/p>\n

In fact, the average household owed a staggering, unsustainable $103,358 last year, with Q2\u00a0consumer debt totaling $16.84 trillion nationally<\/a>\u00a0according to Experian.<\/p>\n

The result is a deeper and more terminal state of consumer financial decline than ever, but don\u2019t tell that to National Retail Federation CEO Matthew Shay. He was unsurprisingly delighted to find a\u00a0record number of shoppers turned out for Black Friday deals<\/a>\u00a0in 2023 despite ballooning consumer debt and broader economic and political uncertainty.<\/p>\n

\u201cShoppers exceeded our expectations with a robust turnout. Retailers large and small were prepared to deliver safe, convenient, and affordable shopping experiences with the products and services consumers needed, and at great prices.\u201d<\/em><\/p>\n

Never mind that many of these shoppers took out loans to pay for it all. <\/strong>With last year\u2019s\u00a0reports of a return to pre-pandemic holiday spending<\/a>, an optimistic outlook appeared superficially tempting. However, inflation isn\u2019t likely to be calmed in 2024. That means that the usual New Year\u2019s resolutions to spend less and save more aren\u2019t going to be enough to stop the credit-fueled doom spending trend.\u00a0<\/p>\n

One major reason is that so-called \u201cresilient\u201d consumers still haven\u2019t paid off their debt from last year\u2019s holidays, have blown through their savings, and are now\u00a0going deeper in debt than ever<\/a>. <\/strong>With little hope left, doom spending has become a self-contradictory psychological palliative and, in some cases, a way for despondent consumers to trick themselves into presenting a veneer of normalcy.<\/p>\n

While politicians love calling high spending a sign of economic strength, they tend to neglect to mention important facts, such as that\u00a0consumers are maxing out their credit cards in the process<\/a>. Ironically, a large subset of consumers respond to financial stress by digging an even deeper hole for themselves, but perhaps they\u2019re just following the example set by the US government and central bank.\u00a0<\/p>\n

Ignoring the specter of trillions in post-Covid money still swirling around in the economy, the Fed claims that it has sufficiently reduced inflationary pressures and can start to lower rates again next year. After declaring inflation \u201ctransitory\u201d in 2023,\u00a0Jerome Powell blamed everything but Federal Reserve monetary policy<\/a>\u00a0for rising prices:<\/strong><\/p>\n

\u201cIt was a combination of very strong demand, without question, and unusual supply-side restrictions, both on the goods side but also on the labor side, because we had a [labor force] participation shock.\u201d\u00a0<\/em><\/p>\n

Now we\u2019re led to believe that rate cuts are on the horizon. And while cheaper borrowing in 2024 may be a good sign for the price of gold, it\u2019s a terrible choice for\u00a0a central bank claiming to have won its war against inflation<\/a>\u00a0after such an unprecedented historic frenzy of Covidian money printing.\u00a0As Peter Schiff remarked about 2023\u2019s final FOMC meeting<\/a>,<\/p>\n

\u201cThe Fed surrendered. Inflation won the fight\u2026it is a pivot in defeat. The Fed stopped hiking rates because it can\u2019t hike them anymore\u2026<\/strong>now that the Fed has said, \u201cMission Accomplished, the dollar is going to tank.\u201d<\/em><\/p>\n

Unable to stuff the inflation genie back in the bottle, consumers aren\u2019t likely to get the relief they need to start actually saving again this year. And while a tanking dollar may be good for gold, for doom spenders, diminishing purchasing power coupled with the availability of cheaper debt will only reinforce their habit.\u00a0The psychology of doom spending<\/a>\u00a0indicates that a lower cost of borrowing will only tempt them to feed their addiction with more borrowed money. Meanwhile, the last of their savings are being wiped out, they\u2019re hitting their current cards\u2019 credit limits, and\u00a0previous debts are increasingly being left unpaid<\/a>.<\/p>\n<\/div>\n

Tyler Durden<\/a><\/span>
\nSun, 01\/14\/2024 – 19:50<\/span><\/p>\n

\u200bRead More<\/a>\u00a0<\/p>\n

\u00a0<\/p>\n","protected":false},"excerpt":{"rendered":"

Debt-Saddled Consumers Embracing Even More “Doom Spending” Via SchiffGold.com, In a disturbing (but unsurprising) trend,\u00a0more than 1 out of 4 US consumers are throwing in…<\/p>\n","protected":false},"author":0,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[1],"tags":[],"class_list":["post-1450628","post","type-post","status-publish","format-standard","hentry","category-news","wpcat-1-id"],"_links":{"self":[{"href":"https:\/\/bugaluu.com\/news\/wp-json\/wp\/v2\/posts\/1450628","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/bugaluu.com\/news\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/bugaluu.com\/news\/wp-json\/wp\/v2\/types\/post"}],"replies":[{"embeddable":true,"href":"https:\/\/bugaluu.com\/news\/wp-json\/wp\/v2\/comments?post=1450628"}],"version-history":[{"count":0,"href":"https:\/\/bugaluu.com\/news\/wp-json\/wp\/v2\/posts\/1450628\/revisions"}],"wp:attachment":[{"href":"https:\/\/bugaluu.com\/news\/wp-json\/wp\/v2\/media?parent=1450628"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/bugaluu.com\/news\/wp-json\/wp\/v2\/categories?post=1450628"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/bugaluu.com\/news\/wp-json\/wp\/v2\/tags?post=1450628"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}