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After the U.S. economy disintegrated in 2008, due to the Banking and Housing crisis, Americans pawned off a record amount of gold. How much gold? Nearly, 32 million oz (1,000 metric tons). That’s one heck of a lot of gold. Matter-a-fact, U.S. gold scrap supply at its peak of 160 metric tons (mt) in 2011, was more than any other country in the world, even India and China.
It is quite unfortunate that Americans have pawned off their best asset only to go further into debt. Thus, enabling them to buy more garbage and trinkets they really don’t need. This is quite the opposite of Americans who become being extremely frugal and financially responsible after the 1930’s Great Depression. Today, banks have made it easy for Americans to BUY NOW and PAY LATER.
The consequences of this “Buy now, pay later” economic model is explained in this recent zerohedge article, 45% Of Americans Spend Up To Half Their Income Repaying Credit Card Debts:
First, roughly 50% of Americans have debt balances, excluding mortgages mind you, of over $25,000, with the average person owing over $37,000, versus a median personal income of just over $30,000.
Therefore, it’s not difficult to believe, as Northwestern Mutual points out, that 45% of Americans spend up to half of their monthly take home pay on debt service alone... which, again, excludes mortgage debt.
Because 45% of Americans are paying up to half of their monthly income to pay down credit cards and debt, they can’t use this income to purchase new goods and services. Thus, a staggering amount of the U.S. Gross Domestic Product (GDP) has been brought forward… thanks to easy credit and credit cards.