American Consumers Now Have More Debt Than Savings

Veuer

A recent report from the Federal Reserve Bank of San Francisco says American consumers have spent their pandemic money and now have more debt than savings. Veuer’s Matt Hoffman has the story.

Transcript

00:00Americans' pandemic savings are all spent up. That's the message from a recent report from

00:04the Federal Reserve Bank of San Francisco. Authors Hamza Abdelrahman and Luis Edgar

00:09Oliveira say that while Americans' savings grew from the beginning of 2020 up to August of 2021,

00:14presumably due to pandemic relief programs, they've now dwindled to the point of being

00:18outweighed by debt. This isn't necessarily cause for economic alarm. The report says that consumer

00:24spending has remained strong. But there is cause for concern. Macromaven's founder Stephanie

00:29Pomboy claimed on Fox Business Tuesday that we've gotten a whole slew of data just in the last week

00:34that suggests consumers have really hit the wall at this point. And CNN quotes Chicago Federal

00:39Reserve President Austin Coolsby as saying that while consumer debt isn't yet worryingly high,

00:44a rise in delinquency would be a warning sign of larger problems. Abdelrahman and Oliveira were

00:49cautiously optimistic, saying the drop in savings is unlikely to result in American households

00:53sharply cutting their spending levels as long as they are able to support their consumption

00:57habits through continuous employment or wage gains, other forms of wealth and higher debt.

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