Second Time Around

And who is surprised about this?

SAN FRANCISCO (AP) - Americans are falling behind on their credit card payments at an alarming rate, sending delinquencies and defaults surging by double-digit percentages in the last year and prompting warnings of worse to come.

An Associated Press analysis of financial data from the country's largest card issuers also found that the greatest rise was among accounts more than 90 days in arrears.

Experts say these signs of the deterioration of finances of many households are partly a byproduct of the subprime mortgage crisis and could spell more trouble ahead for an already sputtering economy.

"Debt eventually leaks into other areas, whether it starts with the mortgage and goes to the credit card or vice versa," said Cliff Tan, a visiting scholar at Stanford University and an expert on credit risk. "We're starting to see leaks now."

I said it several years ago...

Everybody had maxed out their credit cards. So they got a second on the house and paid off all those cards. Then they started using those cards again for anything and everything - although they had promised themselves they wouldn't - and now the cards are once again getting maxed out. But this time, no chance of a second mortgage to pay them off.


The guy is starting to "see leaks"? It's gonna be a flood any day now.

Crunch time again, and this time... No way out.