Part 2/7:
As the holiday season concluded, retail numbers indicated a minor uptick in sales. However, this is misleading, as the increase in sales does not stem from greater demand but rather from skyrocketing prices. Consumers are not purchasing more goods; they are simply spending more due to ongoing inflation. This dynamic is increasingly taxing on consumers, especially those with lower incomes who are now facing higher costs for basic goods.
High credit card balances are another concern, with users coping with annual interest rates averaging over 20%. Some reports indicate rates as high as 29%, exacerbating the debt problem for those carrying balances. In a cycle of economic strain, many consumers have turned to credit cards for purchases, pushing their financial limits further.