It’s not everyday that you see something that leaves you feeling slightly numb. One of the biggest problems to exiting the economic crisis we face today is freeing up credit for consumers. The fact that most consumers are already maxed out on personal debt means that debt needs to be paid down to increase available credit. With the high rate of APR (Annual Percentage Rate) it makes it difficult for consumers to pay down their debt. APRs are averaging 12-16% or interest of $600 – $800 per year on a $5,000 balance.

According to the sharp crew over at Credit Sesame the level of consumer debt per household in the US is just over $18,500 with over one third of that amount consisting of credit card debt. Normally, people would have the option of converting these amounts over to a line of credit at a much, much lower APR but the collapse of the real estate market has made this much more difficult. With most homes worth less than the mortgage amounts outstanding, home owners no longer have the equity in their homes to secure low-interest lines of credit.

Looking at the top line, consumer debt has now exceeded over $2.4 trillion. According to the US Census Bureau, the US population stands at 310,791,024 as of today. That means that there is $7,796 of consumer debt for each American woman, man and child. Of that, roughly $2,646 per person is credit card debt.

There may be several ways to overcome this hurdle and inflation is certainly one of them. If a dollar today is worth fifty cents tomorrow, your debt is cut in half. However, with increasing inflation comes increasing interest rates which can end up growing debt as well.

With worse debt ratios throughout Europe it is more likely that the Euro will suffer a collapse thus resulting in a very strong US dollar. A strong US dollar should delay short-term inflationary pressures. Regardless, check out the Credit Sesame chart below for some interesting facts.