By coinnews 
00:00 Speaker A
Now that the student loan moratorium is over, what effect is that going to have on people’s credit, on their ability to spend in general? That’s the subject of today’s chart of the day. And coincidentally, both Torsten Slok of Apollo, as well as one of our earlier guests, Doug Peta of BCA Research, are watching this phenomenon closely. So this, uh, chart looks at all the different types of debt that people hold. But there’s one that really sticks out here, um, that as, uh, that we haven’t really seen, um, come to the fore over the past couple of years, and that’s student debt, where we could see student student loan delinquencies spike once they are kept track of once again. Uh, Doug Peta, who we spoke to earlier today, he talked a little bit about what might happen as a result.
01:48 Doug Peta
And additionally, you know, this is only at the margin and not everybody has student loans, but now student loans that you didn’t have to pay for the last five years, now there’s a new pod of debt that households have to service.
02:29 Speaker A
And so one of the effects of having to service that, as Torsten Slok points out, is that up to 10% of US households may face a steep decline in their credit score. That then in turn could affect their ability to get loans in different areas, like mortgages or business loans, for example. So you could see a ripple effect. The other thing that Peta was talking about is that because of this happening at the margins, it’s just one more thing that sort of affects the post-pandemic comedown. There was that enormous amount of stimulus injected into the US economy. That pause on student loan repayments was also a form of stimulus, and we are only now finally getting to the end of that big pot of money, as he put it. And so that’s one of the things that could affect consumer spending going forward. But of course, you also have the other types of debt here to contend with as well. And this basically measures the delinquencies on these different types of debt. Credit card, keep an eye on that as well. It is inflecting a little bit higher as we are seeing other types of debt going into that bucket as well. Auto ticking up slightly, but uh, watching all of these things and how they then feed back into consumer spending.