Business

Consumer debt climbs as American credit card balances surpass $1 trillion on August 7, 2023 at 9:25 pm Business News | The Hill

Published

2 years ago

August 8, 2023

Consumer debt grew $17.9 billion from May to June as a credit crunch brought on by Federal Reserve rate hikes drove a sharp gain in the amount of outstanding credit for payments like mortgages and car loans.

The numbers, which are not adjusted for inflation, come in well ahead of expectations at $13 billion and nearly double the increase from the previous month at $9.4 billion.

Debt levels on lump-sum purchases like houses and student loans increased $18.4 billion, offset by a 0.6 percent decrease in the amount of “revolving” credit, which includes things like credit cards and lines of credit.

‘It’s just gonna get paid when it gets paid’: Balance-carrying cardholders crunched by Fed rate hikes

The dip in revolving credit is catching the eye of economists.

“This is surprising and inconsistent with other data we have on consumer spending in the month,” economist Dean Baker with the Center for Economic and Policy Research told The Hill.

“These data are erratic and often subject to substantial revisions, but if we see another drop in July, that would indicate that some consumers are getting maxed out, and we may be in for a substantial slowing in consumption in the second half of the year,” Baker said.

Overall, Baker said, “the second quarter data shows modest credit growth. It fits with the story of consumption growing at a sustainable pace.”

A customer uses an ATM at a Bank of America location in San Francisco April 24, 2023. Bank of America is being ordered to pay more than $100 million to customers for double-dipping on some fees imposed on customers, withholding reward bonuses explicitly promised to credit card customers, and misappropriating sensitive personal information to open accounts without customer knowledge or authorization. (AP Photo/Jeff Chiu, File)

Credit card debt hits $1 trillion for US consumers

Despite the month-over-month decline in revolving credit, credit card debt weighing on U.S. consumers is at an all-time high of more than $1 trillion.

After rising steadily over the last decade, credit card debt levels started easing up in March, 2020, when the government started sending out checks to help households weather the coronavirus pandemic.

They fell by more than $100 billion over the following year, dropping to $736 billion in April, 2021. But then they started rising sharply once again during the booming recovery and are now above their pre-pandemic trend.

Secret spending: Americans are hiding their credit card debt

Total credit card debt is 11.6 percent higher than it was last year, down from a recent high of 18.4 percent last September.

As a share of disposable income, debt service payments are about where they were before the pandemic, hitting 5.7 percent in the first quarter of this year.

Credit card interest rates, along with mortgage rates and other types of financing that rely on charging interest, have been skyrocketing as the Federal Reserve has been raising the rate at which banks can lend each other money.

The average commercial bank interest rate on credit card plans is now above 20 percent, up from just 14.5 percent in February of last year, before the Fed started slowing the economy in response to higher inflation.

That’s the highest level on record for a payment method that is traditionally one of the most expensive ways for consumers to purchase goods and services.

While many measurements of the macroeconomy look healthy at the moment, with second-quarter gross domestic product doing better than expected and inflation dropping fast, it’s not clear that these conditions are extending beyond businesses and improving things for workers and consumers.

Most Americans are living paycheck to paycheck

A recent poll by Lending Club found that a majority of Americans say they are living “paycheck to paycheck.”

“In May 2023, 57 percent of consumers lived paycheck to paycheck,” the poll found.

More than 72 percent of people making less than $50,000 a year live “paycheck to paycheck” while 60.9 percent of people making between $50,000 and $100,000 annually live that way, according to the poll.

Census Bureau data shows that 85.4 million Americans used credit cards to pay their expenses in the last seven days.

The tab is ticking up: Americans owe $1 trillion in credit card debt

Solei Phim, a New York city resident, told The Hill her credit card use has been going up recently for regular expenses including food and laundry. She said she tries to pay her balance off every month so as not to incur interest payments.

“We keep it for the [end of the] month. We try to keep [expenses] within the month and try not to make it past that, but we are using it more frequently,” she said.

Phim added that she put the government stimulus checks she received from both the Trump and Biden administrations over the course of the pandemic into her family’s savings.

Many Americans did the same, leading to a surge in personal savings that gave workers some additional flexibility and likely contributed to high levels of churn in the job market.

Business, News, consumer credit, credit, credit cards, federal reserve Consumer debt grew $17.9 billion from May to June as a credit crunch brought on by Federal Reserve rate hikes drove a sharp gain in the amount of outstanding credit for payments like mortgages and car loans. The numbers, which are not adjusted for inflation, come in well ahead of expectations at $13 billion and…

Business

How Trump’s Tariffs Could Hit American Wallets

Published

20 hours ago

July 11, 2025

Bolanle Media Staff

As the debate over tariffs heats up ahead of the 2024 election, new analysis reveals that American consumers could face significant financial consequences if former President Donald Trump’s proposed tariffs are enacted and maintained. According to a recent report highlighted by Forbes, the impact could be felt across households, businesses, and the broader U.S. economy.

The Household Cost: Up to $2,400 More Per Year

Research from Yale University’s Budget Lab, cited by Forbes, estimates that the average U.S. household could pay an additional $2,400 in 2025 if the new tariffs take effect and persist. This projection reflects the cumulative impact of all tariffs announced in Trump’s plan.

Price Hikes Across Everyday Goods

The tariffs are expected to drive up consumer prices by 1.8% in the near term. Some of the hardest-hit categories include:

Apparel: Prices could jump 37% in the short term (and 18% long-term).
Footwear: Up 39% short-term (18% long-term).
Metals: Up 43%.
Leather products: Up 39%.
Electrical equipment: Up 26%.
Motor vehicles, electronics, rubber, and plastic products: Up 11–18%.
Groceries: Items like vegetables, fruits, and nuts could rise up to 6%, with additional increases for coffee and orange juice due to specific tariffs on Brazilian imports.

A Historic Tariff Rate and Economic Impact

If fully implemented, the effective tariff rate on U.S. consumers could reach 18%, the highest level since 1934. The broader economic consequences are also notable:

GDP Reduction: The tariffs could reduce U.S. GDP by 0.4% annually, equating to about $110 billion per year.
Revenue vs. Losses: While tariffs are projected to generate $2.2 trillion in revenue over the next decade, this would be offset by $418 billion in negative economic impacts.

How Businesses Are Responding

A KPMG survey cited in the report found that 83% of business leaders expect to raise prices within six months of tariff implementation. More than half say their profit margins are already under pressure, suggesting that consumers will likely bear the brunt of these increased costs.

What This Means for Americans

The findings underscore the potential for substantial financial strain on American families and businesses if Trump’s proposed tariffs are enacted. With consumer prices set to rise and economic growth projected to slow, the debate over tariffs is likely to remain front and center in the months ahead.

For more in-depth economic analysis and updates, stay tuned to Bolanlemedia.com.

Business

U.S. Limits Nigerian Non-Immigrant Visas to Three-Month Validity

Published

2 days ago

July 9, 2025

Bolanle Media Staff

In July 2025, the United States implemented significant changes to its visa policy for Nigerian citizens, restricting most non-immigrant and non-diplomatic visas to a single entry and a maximum validity of three months. This marks a departure from previous policies that allowed for multiple entries and longer stays, and has important implications for travel, business, and diplomatic relations between the two countries.

Key Changes in U.S. Visa Policy for Nigerians

Single-Entry, Three-Month Limit: As of July 8, 2025, most non-immigrant visas issued to Nigerians are now valid for only one entry and up to three months.
No Retroactive Impact: Visas issued prior to this date remain valid under their original terms.
Reciprocity Principle: The U.S. cited alignment with Nigeria’s own visa policies for U.S. citizens as the basis for these changes.
Enhanced Security Screening: Applicants are required to make their social media accounts public for vetting, and are subject to increased scrutiny for any signs of hostility toward U.S. institutions.

Rationale Behind the Policy Shift

Security and Immigration Integrity: The U.S. government stated the changes are intended to safeguard the immigration system and meet global security standards.
Diplomatic Reciprocity: These restrictions mirror the limitations Nigeria imposes on U.S. travelers, emphasizing the principle of fairness in international visa agreements.
Potential for Further Action: The U.S. has indicated that additional travel restrictions could be introduced if Nigeria does not address certain diplomatic and security concerns.

Nigeria’s Updated Visa Policy

Nigeria Visa Policy 2025 (NVP 2025): Introduced in May 2025, this policy features a new e-Visa system for short visits and reorganizes visa categories:
- Short Visit Visas (e-Visa): For business or tourism, valid up to three months, non-renewable, processed digitally within 48 hours.
- Temporary Residence Visas: For employment or study, valid up to two years.
- Permanent Residence Visas: For investors, retirees, and highly skilled individuals.
Visa Exemptions: ECOWAS citizens and certain diplomatic passport holders remain exempt.
Reciprocal Restrictions: Most short-stay and business visas for U.S. citizens are single-entry and short-term, reflecting reciprocal treatment.

Impact on Travelers and Bilateral Relations

Nigerian Travelers: Face increased administrative requirements, higher costs, and reduced travel flexibility to the U.S.
U.S. Travelers to Nigeria: Encounter similar restrictions, with most visas limited to single entry and short duration.
Diplomatic Tensions: Nigerian officials have called for reconsideration of the U.S. policy, warning of negative effects on bilateral ties and people-to-people exchanges.

Conclusion

The U.S. decision to limit Nigerian non-immigrant visas to three months highlights the growing complexity and reciprocity in global visa regimes. Both countries are tightening their policies, citing security and fairness, which underscores the need for travelers and businesses to stay informed and adapt to evolving requirements.

Business

Nicki Minaj Demands $200 Million from Jay-Z in Explosive Twitter Rant

Published

3 days ago

July 9, 2025

Bolanle Media Staff

Nicki Minaj has once again set social media ablaze, this time targeting Jay-Z with a series of pointed tweets that allege he owes her an eye-popping $200 million. The outburst has reignited debates about artist compensation, industry transparency, and the ongoing power struggles within hip-hop’s elite circles.

The $200 Million Claim

In a string of tweets, Minaj directly addressed Jay-Z, writing, “Jay-Z, call me to settle the karmic debt. It’s only collecting more interest. You still in my top five though. Let’s get it.” She went further, warning, “Anyone still calling him Hov will answer to God for the blasphemy.” According to Minaj, the alleged debt stems from Jay-Z’s sale of Tidal, the music streaming platform he launched in 2015 with a group of high-profile artists—including Minaj herself, J. Cole, and Rihanna.

When Jay-Z sold Tidal in 2021, Minaj claims she was only offered $1 million, a figure she says falls dramatically short of what she believes she is owed based on her ownership stake and contributions. She has long voiced dissatisfaction with the payout, but this is the most public—and dramatic—demand to date.

Beyond the Money: Broader Grievances

Minaj’s Twitter storm wasn’t limited to financial complaints. She also:

Promised to start a college fund for her fans if she receives the money she claims is owed.
Accused blogs and online creators of ignoring her side of the story, especially when it involves Jay-Z.
Warned content creators about posting “hate or lies,” saying, “They won’t cover your legal fees… I hope it’s worth losing everything including your account.”

She expressed frustration that mainstream blogs and platforms don’t fully cover her statements, especially when they involve Jay-Z, and suggested that much of the coverage she receives is from less reputable sources.

Satirical Accusations and Industry Critique

Minaj’s tweets took a satirical turn as she jokingly blamed Jay-Z for a laundry list of cultural grievances, including:

The state of hip-hop, football, basketball, and touring
The decline of Instagram and Twitter
Even processed foods and artificial dyes in candy

She repeatedly declared, “The jig is up,” but clarified that her statements were “alleged and for entertainment purposes only.”

Political and Cultural Criticism

Minaj also criticized Jay-Z’s political involvement, questioning why he didn’t campaign more actively for Kamala Harris or respond to President Obama’s comments about Black men. While Jay-Z has a history of supporting Democratic campaigns, Minaj’s critique centered on more recent events and what she perceives as a lack of advocacy for the Black community.

The Super Bowl and Lil Wayne

Adding another layer to her grievances, Minaj voiced disappointment that Lil Wayne was not chosen to perform at the Super Bowl in New Orleans, a decision she attributes to Jay-Z’s influence in the entertainment industry.

Public and Industry Reaction

Despite the seriousness of her financial claim, many observers note that if Minaj truly believed Jay-Z owed her $200 million, legal action—not social media—would likely follow. As of now, there is no public record of a lawsuit or formal complaint.

Some fans and commentators see Minaj’s outburst as part of a larger pattern of airing industry grievances online, while others interpret it as a mix of personal frustration and performance art. Minaj herself emphasized that her tweets were “for entertainment purposes only.”

Conclusion

Nicki Minaj’s explosive Twitter rant against Jay-Z has once again placed the spotlight on issues of artist compensation and industry dynamics. Whether her claims will lead to further action or remain another dramatic chapter in hip-hop’s ongoing soap opera remains to be seen, but for now, the world is watching—and tweeting.