In terms of outstanding debt as a percentage of personal income, consumers hold more debt than ever before. In terms of debt burden, i.e., debt payments as a percent of disposable personal income, the consumer is more burdened today than prior to the last recession in 1990/91 (even though current interest rates are much lower). This suggests that if the economy slips into recession, consumer credit performance will deteriorate sharply, and delinquencies and losses in many consumer sectors could suffer as much as (or more than) in the last recession.

Consumer credit cycles

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