From 1966 to 2000 (34 years), the Federal debt rose from $.3 trillion to $5.8 trillion. It began to rise steeply in 2008 and by mid- 2012 it had reached almost $16 trillion. Between Q1 2008 and Q1 2012, Federal debt increased by about $6.4 trillion.
In June, 2008 consumers began deleveraging (this includes defaulting on loans). Their debt levels decreased for 27 months, until September, 2010. At that point their debt levels again began increasing and by June 2011 debt loads returned to the previous peak of June 2008. Since that time, they have been increasing at a rate similar to June, 2008.
Neither the debt levels of the federal government nor consumers are healthy for the economy in the long-term.
For more detailed analysis of the state of the economy compared to four years ago, visit https://cber.co or click here.
©Copyright 2011 by CBER.