Depending on your perspective…
• Debt is good if it is used to make purchases that stimulate consumption and economic growth.
• Debt can deter growth if debt service obligations prevent consumption and economic growth.
Whether or not you believe debt is good for the economy, one thing is for sure. Debt has increased!
Federal Debt
• 1966 to 2000 (34 years), $.3 trillion to $5.8 trillion; the level of debt increased by$5.3 trillion.
• 2000 to 2008 (8 years) $5.8 trillion to $9.4 trillion; the level of debt increased by $3.6 trillion.
• 2008 to July 2014 (68 months) $9.4 to $17.8 trillion; the level of debt increased by $8.4 trillion.
Public Debt has exceeded GDP since Q4 2012. The only other time that debt as a percent of GDP has been greater was during the 1940s.
Consumer Credit Outstanding
• In January 2006 Consumer Credit Outstanding was $2.37 trillion.
• In October 2014 Consumer Credit Outstanding was $3.28 trillion.
Student Loans
• In Q1 2006 Student Loans Outstanding were $500 billion.
• In Q3 2014 Student Loans Outstanding were $1.3 trillion.
Is this level of debt stimulating or preventing growth in the U.S. economy?
