Throughout 2005 we heard of the incredible growth in consumer debt. Credit Card companies raised credit card limits of many consumers. Many folks used home equity loans to pay off credit card loan debris which was hurting their middle class perceived entitlements to have it all in advance of paying for anything. Buy, buy, buy and shop till you drop was the battle cry, yet in retrospect who is crying now?

Once these consumers paid off their high-interest credit card debt with low-interest rate home equity loans they lowered their over all debt load and the interest they were paying on this debt; a once in a life-time opportunity to work their way out of debt. But instead the credit card companies showed their credit cards paid off on their credit reports and then upped their credit limits, sent them new cards with higher balances. And like any good debt ridden “give it to me now” American consumer these folks proceeded to charge it all back buying alls sorts of consumer goods, that they neither needed or had places to store.

In 2006 we will not see such a rocket ship increase in home equity and in some markets we have seen a plateau in the housing market and a pull back in many other markets. In fact home foreclosures up. In Las Vegas one of the top two fastest growing housing markets for all of 2002-2005 we are seeing some 80-90 foreclosures per day. Private debt load in the United States has reached 1.2 Trillion.

We saw lack luster 2005 Christmas Sales and slowing of the consumer spending, at least at the rates we saw previously. Of course some of those dollars are still being spent, yet on necessities such as gasoline and heating fuel. The over all trend in the economy will not be a negative one but you can expect fuel prices to inch back up and this credit card issue become the back breaker of many a middle class family in America. Think more on this in 2006.

"Lance Winslow" - Online Think Tank forum board. If you have innovative thoughts and unique perspectives, come think with Lance; http://www.WorldThinkTank.net/wttbbs/

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