The latest report from the Federal Reserve Bank of New York triggered all manner of financial anxiety. At $13.2 trillion, total U.S. household debt increased from $12.7 trillion a year ago, a jump of nearly four percent. Lending Tree, a loan comparison website, reported that the consumer-debt portion of total household debt will hit $4 trillion well before the end of the year. It added that Americans owe more than 26 percent of their annual income to this debt, up from 22 percent in 2010, and that debts on auto loans and credit cards are climbing by more than seven percent a year.
The savings rate of the average American household has declined to 2.4 percent, nearly a record low.
Last year, the Federal Reserve rattled the markets with its survey that indicated that 35 percent of U.S. adults reported that they would not be able to pay all of their bills if they were faced with a $400 emergency....
