Why You Should Expect a Once-in-a-Lifetime Debt Crisis

U.S. credit card debt surpasses $1 trillion

On a national level, a debt crisis occurs when a country is unable to pay back its government debt. This might result from government spending exceeding tax revenues for an extended period.

On an individual level, a crisis can result from too little income and too much debt — that simple. This sometimes means defaulting on a car loan, for example, or even declaring bankruptcy.

Part 1 of the June Elliott Wave Theorist said:

A debt crisis is brewing, and higher long term interest rates will add to the pressure.

Indeed, as Kiplinger noted on Aug. 18:

Credit Card Use Spikes for Cash-Strapped Consumers

Credit card use amps up as consumers reckon with inflation and higher interest rates; 39% of Americans living paycheck-to-paycheck, study shows.

The August Elliott Wave Theorist had more to say about the looming debt crisis as it showed these side-by-side charts:

Excess savings US households built up during the pandemic are nearly gone…

At the same time, consumers are borrowing to stay alive, driving indebtedness to yet another milestone: Total credit card debt in the U.S. has just surpassed $1 trillion. Will consumers be able to pay it off?

They had better do it fast, because credit-card interest rates have just soared to a new all-time high above 20%!

And bond yields (and interest rates) continue to climb (Reuters, Sept. 21):

TREASURIES-Two-year yields hit 17-year highs…

Elliott Wave International warned subscribers to prepare back in 2020 when interest rates were near zero.

Of course, a lot of people are wondering if rates are headed even higher.

Remember, it’s the market which determines the direction of interest rates; the Fed merely follows.

You can get our latest insights into the bond market, as well as the developing debt crisis, by following the link below.

Treacherous Financial Times Likely Ahead

You might as well know here and now that it appears the U.S. stock market has reached a critical juncture — not just any critical juncture — but one of the most important in three centuries!

Undue alarmism? Not in the least.

If our Elliott wave analysis is correct, many investors will be shocked by the behavior of the market in the months ahead.

Could we be wrong? Yes, no method of market analysis offers a guarantee.

Yet, you owe it to yourself at this juncture to learn the message of Elliott wave analysis.

Read our latest outlook for stocks, bonds, gold, silver, the U.S. Dollar and more as you follow the link below.