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Realistbear

Debt Index Reveals The Worst Is Not Behind Us

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http://www.creditman.biz/uk/members/news-v...chksrc=NNow4251

TDX Debt Index increase reveals that banks may not have seen the worst yet
Aug 7 2007
TDX Group today released the TDX Debt Index for Q2 2007. While the index remained largely flat, showing a 0.4% quarter-over-quarter increase (compared to 4.7% growth last quarter), it is up 5.38% year-over-year. The change is driven primarily by
deterioration in the Wealth Indicators component
. The Debt Burden component remains broadly neutral and the Delinquency Indicators component has shown improvement...../
However, high house prices and increasing interest rates are combining to increase living costs and the burden of debt. As these costs increased, there was a sharp fall in the Household Savings Ratio as consumers were able to save less.
These trends will result in continued pressure on consumers trying to manage their debts and this fact is supported by recent numbers including those from the Council of Mortgage Lenders showing that repossessions grew 18% is the first half of 2007.

The recent fall in consumer spending may be a reflection of the increasing debt burden and inability of consumers to raise more credit thus leading to inevitable increases in reposessions. Some might like to blame the weather but, IMO, it is simply a case of too much borrowing. It all points to a general slowdown accross the board and house prices will see the impact of reposession rates incfrease as the first in a large number of 2005 resets commence in September.

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