One of the key characteristics of the recent slump has been the great “deleveraging” has households have drastically shed debt.
Well that’s over.
The latest Flow Of Funds report from the Fed is out. That report gives a quarterly update on what’s happening with debt and asset flows in the economy. And what’s clear is that the household sector is adding debt again.
This chart (via Matt Busigin) shows the quarterly increase in household debt. It’s exploding higher. Deleveraging over.