Credit Card and Student Loan Debt Explode

I meant to get to this during the week when I originally saw it but, well, you know – there were a few other things going on…

From the New York Post:

US consumer borrowing jumped in June by the most in four years, led by a gain in nonrevolving debt, including student loans.

Credit increased by $15.5 billion, three times as much as projected and the biggest gain since August 2007, after a $5.08 billion advance in May, the Federal Reserve said Friday.

Americans appear to be staying in school longer or seeking more training in the hope of landing a job. At the same time, elevated gasoline and food costs may be straining household budgets, prompting consumers to turn to their credit cards to purchase necessities.

I use an American Express to purchase groceries, it earns double points at grocery stores.  It gets paid back in full a month later.  I’m not sure if that’s the kind of “credit card spending for necessities” this report is referring to.  If we’re talking about people charging milk, bread and eggs at a 21% APR card from Household Bank that they’ll get around to paying once they have a job, well, that’s not so good.

Source:

Consumers put staples on credit; receipts up $15B (NYP)