Click here for the PDF: The Weekly Beacon December 8 2023

We will be giving some macro economic market updates on a weekly basis. No equity recommendations will be given in this commentary, and we encourage you to contact us if you have questions regarding any observations.

Feel free to send in your pictures of lighthouses to be featured in our weekly commentary.

This weeks issue: Consumer spending, Credit card debt, Consumer paying later for products now, Interest rates on credit cards, Late fees on credit cards, Credit card stocks, AMEX stock, VISA stock, Mastercard stock, Credit card market, Asset allocation by age, Cash exposure, Equity exposure, Alternative assets, Coinbase stock, Jim Cramer bad calls, Coinbase versus the rest, Chapter 11 filings, Bankruptcy spike, Housing market, First time home buyers, Open a FHSA today.

Banking on consumers (bad) habits

Over the last few months in this publication, we have talked about how consumers continue to spend despite personal balance sheets deteriorating. Excess savings from the pandemic have disappeared, prices have risen, and consumers want to continue to spend especially over the holidays.

This has resulted in elevated credit card delinquencies, higher credit card interest rates, and more consumers choosing to buy now and pay later. Consumers are essentially buying products they cannot afford and worrying about the consequences later.

Credit card delinquencies are at a multi-year high:

For those who are late on their payments or only paying the minimum credit card balance, interest rates have not been kind:

Interest rates on credit card plans have surged to 21.19%, a record high, as consumers continue to add on debt that they cannot afford.

We know we have mentioned the above in past issues and only preface the points to introduce our next topic.

Click here for the PDF: The Weekly Beacon December 8 2023