Elbows-Up Economics

"Consumer (non-mortgage) credit climbed 0.2% (+$1.3 billion) to $835.7 billion in July, up 4.7% (+$37.6 billion) since last year. The growth rate remains higher than mortgages, and this isn’t one of those good consumer growth surges. 

The recent consumer credit bump is due to consumption smoothing and/or distress borrowing, according to TransUnion. Smoothing occurs when households use debt to avoid cutting expenses when their incomes fail to keep up. The credit agency warns that households are tapping higher-interest revolving credit to absorb the higher cost of living. TransUnion also found that mortgages were rising under similar circumstances, as balances are climbing on existing accounts, not new borrowing."

Canadian Debt Hits $3.29 Trillion As Distress Borrowing Surges - Better Dwelling