Credit-Land Report: U.S. Households Show Up-tick in... - Other News

Advertising Disclosure

Credit-Land.com is an independent, advertising-supported web site. Credit-Land.com receives compensation from many credit card issuers whose offers appear on our site. Compensation from our advertising partners impacts how and where their products appear on our site, including, for example, the order in which they may appear within review lists. Credit-Land.com has not reviewed all available credit card offers in the marketplace.

Credit Card Applications » News » Other » Credit-Land Report: U.S. Households Show Up-tick in Wealth

Credit-Land Report: U.S. Households Show Up-tick in Wealth

Add to Favorites:
Credit-Land Report: U.S. Households Show Up-tick in Wealth

U.S. household wealth rose by 1.2% to $58.1 trillion during the first quarter of 2011, according to the most recent report by the Federal Reserve. In addition, U.S. households reduced their debt load, making it the 12th consecutive quarter that this has occurred. Consumer credit also rose for the second straight quarter after eight consecutive quarters of declines.


The data showed that the up-tick in wealth came from gains from stocks and other investments while the decline in real estate values continued to plague U.S. wealth formation. Household wealth has still not recovered from its high of $64.2 trillion at the end of 2007 before the collapse of the housing market.


Creditworthiness


The decline in the debt figures reflect sluggish activity in the housing market with mortgages down 3.4%. Foreclosure or mortgage modification also contributed to the decline in overall debt. Nevertheless, some analysts noted that the reduced debt burdens may put consumers in a better financial position to increase borrowing and open new credit accounts. Predominantly, the loans that consumers are drawn to these days are auto loans and student loans. In total, the consumer debt level increased at an annual rate of 2.4%, which is the second straight quarterly increase after decreasing for eight months in a row.


Businesses Borrowing More Too


Companies in the U.S. are borrowing more money too. The Federal Reserve tracks the flow of funds between American businesses, creditors and spending in general. On a quarterly basis, the Fed reports that business debt increased by 4%. Increased borrowing tends to be an indication that consumers and businesses feel that the economy is moving towards stable ground.


At the same time, businesses also reported a record $1.91 trillion in cash. While the large cash balances may indicate apprehension over the economy near-term, it does provide liquidity for growth and acquisitions in the future. At the end of 2004, business cash reserves totaled about $1.27 trillion.


Local and state governments cut their debt by 2.9% in the first quarter after expanding debt by 7.9% in the previous quarter. The federal debt increased by 20.2% during 2010 and grew 7.8% in the first quarter of 2011.

All credit cards terms, fees and rates mentioned in this article/post are actual on the posting date. See the current products’ Terms & Conditions on the issuing banks' websites.
Add to Favorites:

Related News:

Gen Z and Millennials Spending More This Holiday Season

Posted: November 23, 2017

Holiday shopping is in full swing, and while spending trends are on target to be on par with last year across the generations, Gen Z and Millennials are feeling more festive, and are on point to spend more this season whether that's on ... Continue reading
Hackers Are Not Dimming Holiday Cheer

Posted: November 22, 2017

Holiday shopping season can be a big draw for criminals, in both stores and online, and while consumers are worried, it's not going to get in their way this season, according to a new study by Discover. They found that 73% of people will ... Continue reading
Small Business Saturday Resonates With Consumers

Posted: November 21, 2017

If you know that November 25 is Small Business Saturday you are in good company because 61% of consumers know it is taking place too, according to the 2017 Small Business Saturday Consumer Insights Survey. Continue reading
Get the latest news, articles and expert advice delivered to your inbox. It's FREE.
We'll match all the Miles you've earned at the end of your first year. For example, if you earn 30,000 Miles, you get 60,000 Miles.
For Excellent, Good Credit
INTRO OFFER: Discover will match ALL the cash back earned at the end of your first year, automatically.
For Excellent, Good Credit
Our application is quick and easy with instant pre-qualification available
For Fair / Good Credit