Americans are still spending, but spending quality matters more than headline numbers.
JPMorgan reported a 10% year-over-year increase in combined credit and debit card sales, while Bank of America data showed household card spending rose 6.2% in September. Demand remains strong despite inflation and high borrowing costs.
However, strong spending does not guarantee financial health. Wealthier households can spend comfortably, while others sacrifice savings or postpone major purchases.
The bigger concern is what happens if the labor market weakens while interest costs remain high. Consumers have less room to absorb shocks, especially those carrying credit-card balances.
My takeaway: The consumer engine is running, but investors should watch credit delinquencies, savings and purchasing power—not just sales growth. Economic weakness often begins when households quietly run out of financial flexibility.
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