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A New World Monetary Order Is Coming
ZeroHedge.com Fri, 10/30/2020 - 22:20 Authored by Stefan Gleason via ActivistPost.com, The global coronavirus pandemic has accelerated several troubling trends already in force. Among them are exponential debt growth, rising dependency on government, and scaled-up central bank interventions into markets and the economy. Central bankers now appear poised to embark on their biggest power play ever. Federal Reserve Chairman Jerome Powell, in coordination with the European Central Bank and International Monetary Fund (IMF), is preparing to roll out central bank digital currencies. The globalist IMF recently called for a new “Bretton Woods Moment” to address the loss of trillions of dollars in global economic output due to the coronavirus. In the aftermath of World War II, the original Bretton Woods agreement established a world monetary order with the U.S. dollar as the reserve currency. Importantly, the dollar was to be pegged to the price of gold. Foreign governments and central banks could also redeem their dollar reserves in gold, and they started doing so in earnest in the 1960s and early 1970s. In 1971, President Richard Nixon closed the gold window, effectively ushering in a new world monetary order based solely on the full faith and credit of the United States. An inflation crisis followed a few years later. In response, the Federal Reserve took the painful step of jacking up interest rates to defend its wilting Federal Reserve Note and tame rising prices. Fast forward to 2020, and the Fed has assumed for itself novel policy mandates that are a precursor to a new monetary system. But the monetary masters aren’t contemplating a return to sound money. Rather, they’re planning for even more debt, more inflation, and picking of winners and losers in the economy. The Fed has unceremoniously thrown its statutory dual mandate of full employment and stable prices out the window. It now gives itself an unlimited mandate to inject stimulus and bailout cash wherever it sees fit (including, recently, “junk” bond exchange-traded funds). Instead of pursuing stable prices, the Fed is now explicitly embarking on an inflation-raising campaign with the goal of generating annual price level increases above 2% for an undefined period. The next frontier of the Fed’s unlimited mandate could be “FedCoin” – a central bank digital currency. Earlier this month Chairman Powell participated in an IMF panel on international payments and digital currencies. He touted electronic payments systems and raised the possibility of integrating them into a central bank digital currency regime. Powell has so far declined to outright endorse a move toward a fully cashless system which countries including China and Sweden are spearheading. But he is on board with the larger globalist agenda of expanding the role of monetary policy in shaping economic and social outcomes. IMF Managing Director Kristalina Georgieva sees expanded monetary tools being aimed at every issue under the sun: “We will have a chance to address some persistent problems – low productivity, slow growth, high inequalities, a looming climate crisis… We can do better than build back the pre-pandemic world – we can build forward to a world that is more resilient, sustainable, and inclusive.” The IMF is being pressured by debt campaigners to sell some of its gold reserves to cover payments owed by some of the world’s poorest countries. The IMF would issue pseudo-currency units known as Special Drawing Rights (SDRs) to cancel the debts of poor countries. In a world where central bank balance sheets have grown by more than $7 trillion, it’s not surprising that everyone wants a piece of the pie and that many now view gold as dispensable. Is gold merely a barbarous relic in this brave new digital world? If it were, then it would have collapsed in price this year, amid all the new central bank rollouts, instead of surging to an all-time high. Precious metals may be the ultimate hedge against the new world monetary order. In the event that the U.S. central bank launches a digital dollar and assigns every American a virtual wallet, there would be no escaping adverse monetary policy decrees except by exiting fiat currencies entirely. Under a central bank digital currency, authorities could impose negative interest rates on all holdings of currency units. They could do so without needing to get anyone to buy negative-yielding bonds or deposit money into negative-yielding bank accounts. Under a central bank digital currency, direct credits and debits could replace stimulus checks and taxes. It would be the vehicle through which modern monetary theory could be fully implemented – with the central bank becoming tax collector and funder of all government operations. If depreciating the value of the currency through the inflation tax wasn’t enough, the Fed could also stick dollar-holders with a direct tax in the form of negative interest rates. Once paper notes are phased out, holding cash itself would no longer be a way for individuals to escape negative rates. The only escape hatches would be volatile alternative digital currencies (such as Bitcoin) or hard money (gold and silver). Under a monetary order where electronic digits representing currency can be created out of thin air in unlimited quantities, the best hedge is the opposite – tangible, scarce, untraceable wealth held off the financial grid.
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Credit Card Debt Statistics for 2020 (so far)
(www.fool.com) What's the average credit card debt per person? What's the total credit card debt in the U.S.? How do debt figures break down by age? Are millennials borrowing as much as we think they are? We looked at the best and most recent data from government and institutional sources -- including the Federal Reserve, the Consumer Financial Protection Bureau, and Experian -- to answer your most pressing questions on credit card debt. Key findings
However, the average doesn't tell the whole story. Approximately 52% of Americans have credit card balances of $2,500 or less. Alaskan consumers have the highest credit card debt, with an average of $8,026. New Jersey residents are second, with an average credit card balance of $7,084. Iowa consumers have the lowest credit card debt, with an average balance of $4,744, followed by Wisconsin with an average of $4,908. Credit card balance in 2019Percentage of U.S. credit card holders$2,500 or less52.1% $2,500-$5,00015.5% $5,000-$7,5008.8% $7,500-$10,0005.7% $10,000-$15,0006.7% $15,000-$20,0003.8% $20,000-$30,0003.8% $30,000-$50,0002.5% $50,000 or more1.1% Data source: Experian (2019).Average credit card debt by credit scoreThe highest credit card balances are carried by consumers with credit scores in the 670–739 range, which is typically considered to be average credit. The lowest credit card balances are carried by consumers with poor credit scores, which makes sense because of their limited access to credit. Consumers with top-tier credit scores also carry below-average credit card balances. Credit score rangeAverage credit card debt300–579 (Poor)$3,446 580–669 (Fair)$6,489 670–739 (Average/Good)$9,712 740–799 (Great)$6,051 800–850 (Exceptional)$3,616 Data source: Experian (2019).Average credit card debt by ageTotal credit card debt increases over time until people reach the 50–59 age group. It then decreases steadily in the latter half of consumers' lives, according to data from the Federal Reserve Bank of New York. Age groupTotal credit card debt18–29$52.1 billion 30–39$151.4 billion 40–49$196.6 billion 50–59$213.2 billion 60–69$163.0 billion 70 and older$116.6 billion Data source: Federal Reserve Bank of New York (2020).The average credit card balance hits a peak of $7,100 for households aged 45–54 and declines steadily after that, according to the Federal Reserve Board's 2016 Survey of Consumer Finances. The fact that seniors' credit card debt accounts for a relatively large portion of their total debt is explained by a reduction in other kinds of debt, such as mortgages and auto loans. Average credit card debt by education level and occupational statusLooking at credit card debt by household education level, we find that the percentage of families holding credit card debt generally increases with education, though it drops off among Americans who have a college degree. Education level of head of household% Holding credit card debtAverage credit card debtNo high school diploma35.2%$3,800 High school diploma44.3%$4,600 Some college50.8%$4,700 College degree41.3%$8,200 Data source: Federal Reserve Board (2016).When looking at the average amount of credit card debt per household by education level, the trend changes a bit. Federal Reserve Board data shows that households where the head has no high school diploma carry $3,800 in debt on average, and those with a college degree carry more than twice as much at $8,200. When examining debt by occupational status, we find that those "working for someone else" were most likely to carry credit card debt at 50.4%, compared to 46.1% of those who were self-employed and 32.7% for retirees. However, self-employed people had the highest average credit card balance at $8,000, compared to $5,700 for those working for someone else and $4,600 for retirees. The high credit card balance for self-employed individuals could be due to an overlap of business and personal expenses on the same credit card. Average credit card debt by raceWhen it comes to credit card balances by race, non-Hispanic whites are at the bottom of the range, with 42.1% of families carrying a balance, according to Federal Reserve Board data. Hispanic and Latino families are at the top of the range at 49.6%. In the middle are African American families at 47.8% and "other" or "multiple-race" Americans at 44.1%. Despite having the lowest percentage of cardholders who carry a balance, white, non-Hispanic families had the highest average credit card debt at $6,500, followed by other/multiple-race families at $5,700, and African American and Hispanic/Latino families at $3,800. Race% With credit card debtAverage credit card debtWhite (non-Hispanic)42.1%$6,500 Hispanic/Latino49.6%$3,800 African American47.8%$3,800 Other44.1%$5,700 Data source: Federal Reserve Board (2016).When it comes to credit card usage by race, non-Hispanic whites are at the bottom of the range, with 42.1% of families carrying a balance, shows Federal Reserve Board data. Hispanic and Latino families are at the top of the range at 49.6%. In the middle are African American families at 47.8% and "other" or "multiple-race" Americans at 44.1%. Despite having the lowest credit card usage rate, white, non-Hispanic families had the highest average credit card debt at $6,500, followed by other/multiple-race families at $5,700 and African American and Hispanic/Latino families at $3,800. Total U.S. credit card debtTotal credit card balances in the United States are $893 billion as of the first quarter of 2020, according to the New York Federal Reserve. This has increased considerably over the past few years, but declined a bit in early 2020 as the COVID-19 pandemic hit. How many credit cards does the average American have?The average consumer with credit cards has four of them, with a combined limit of $31,015, according to Experian. 61% of Americans have at least one credit card. Consumers with higher credit scores tend to have more credit cards. FICO says the average consumer with a score of 800 or higher has 10 open revolving credit accounts. How many credit cards do Americans have?Americans have more than half a billion credit cards -- 511.4 million as of the first quarter of 2020. That's 95 million more credit cards than they had in 2015. YearNumber of credit card accounts2015415.8 million 2016435.6 million 2017454.6 million 2018466.9 million 2019482.7 million 2020511.4 million Data source: Federal Reserve Bank of New York. Note: Number of accounts as of the first quarter of each year.Credit utilizationAccording to the New York Federal Reserve Consumer Credit Panel and Equifax data, Americans have a total of $3.93 trillion in credit limits as of the first quarter of 2020. As mentioned in the last section, there is a total of $893 billion in credit card debt in the United States, which translates to approximately 23% of the total credit limit. Credit card origination statisticsOver the 10-year period ending April 2019, the number of credit cards originated per month climbed from 3.68 million to 5.89 million, according to the Consumer Financial Protection Bureau (CFPB). The number of new credit cards originated peaked in July 2016 at 6.86 million. The volume of new credit cards originated varies considerably by state. Minnesota, Rhode Island, Wyoming, and Delaware all had year-over-year origination volume increases of 25% or more, while Utah, Tennessee, and Vermont had originations fall by 25% or greater as of April 2019. COVID-19 credit card debt statisticsThe average American could save $88 per month if their credit card company agrees to waive interest on their credit card debt, according to The Ascent's calculations. Americans have actually become less worried about their credit card debt during the pandemic. In a survey on financial priorities during COVID-19 by The Ascent, fewer than 10% of respondents said their credit card debt was a top financial priority, compared with 14.8% before the pandemic. Employment and general financial survival have increased in priority. The survey of more than 1,500 Americans was conducted on April 3, 2020. 6.1% of Americans planned to use their stimulus check money for the specific purpose of paying off credit card debt. Credit card delinquency statisticsApproximately 9.1% of all credit card balances in the United States were 90 days or more delinquent as of the first quarter of 2020. The lowest recorded credit card delinquency rate was 7.1% in the third quarter of 2016 and the highest was 13.7% in the second quarter of 2010 in the wake of the Great Recession. Average credit card interest ratesThe average credit card interest rate in the U.S. is 14.52% as of May 2020. However, this includes both interest-charging accounts and accounts that are not assessed interest (promotional 0% APR offers, for example). If we just consider accounts that are assessed interest, the average interest rate is 15.78%, according to the Federal Reserve. Credit card interest rates are directly tied to the federal funds rate, so they have fallen since the COVID-19 pandemic hit. Sources
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