That “deleveraging” has further to go, but seems to have slowed as rock-bottom interest rates coax consumers to indulge some of their pent-up demand for homes and cars.
A March 2018 Bankrate survey found that one fifth of Americans aren't saving any money for things such as retirement, chiefly, they say, because they can't afford to.
And they’re more vulnerable to job losses, subject to inflation, tightening loans from banks, appreciation of the renminbi, or decline of demand from Europe or America for the products they produce.
Many thought the federal Reserve's decision to continuously increase interest rates in 2023, in order to help slow inflation would lead to job losses and spin the economy into a recession.
A regular bank rate today is probably in the seven or 8% neighborhood, so there is a big gap between what the open market's available and what a manufacturer is willing to subsidize.
Last week, the Bank of England made its 11th consecutive increase to interest rates, meaning that the bank rate in the UK is now 4.25 per cent, the highest level in 14 years.
When you draw up a written contract, establish repayment terms— including interest (doesn't have to be bank-rate interest, but at least something minimal to provide motivation to pay on time)— and have both parties sign.