(The Economic Collapse Blog)—I truly wish that headline was an exaggeration. Unfortunately, for decades Americans have been extremely irresponsible with their finances. As a result, credit card debt is at an all-time high, auto loan debt is at an all-time high, mortgage debt is at an all-time high, corporate debt is at an all-time high, state and local governments all over the nation continue to get into absurd amounts of debt, and the federal government has piled up the single largest mountain of debt in the history of the world.
Our whole society is absolutely drowning in debt at this stage, and the only way out is for the entire system to collapse.
On Tuesday, we learned that the total amount of credit card debt in the U.S. has now reached a new record high of 1.08 trillion dollars…
Americans now owe $1.08 trillion on their credit cards, according to a new report on household debt from the Federal Reserve Bank of New York.
Credit card balances spiked by $154 billion year over year, notching the largest increase since 1999, the New York Fed found.
“Credit card balances experienced a large jump in the third quarter, consistent with strong consumer spending and real GDP growth,” said Donghoon Lee, the New York Fed’s economic research advisor.
Credit card debt has always been one of the most insidious forms of debt, but now the banks are pushing credit card interest rates to unprecedented heights…
The rise in credit card usage and debt is particularly concerning because interest rates are astronomically high right now. The average credit card annual percentage rate, or APR, hit a new record of 20.72% last week, according to a Bankrate database that goes back to 1985. The previous record was 19% in July 1991.
If people are carrying debt to compensate for steeper prices, they could end up paying more for items in the long run. For instance, if you owe $5,000 in debt — which the average American does — current APR levels would mean it would take about 279 months and $8,124 in interest to pay off the debt making the minimum payments.
It should be illegal to issue a credit card that has an interest rate higher than 20 percent.
But banks are going to keep doing it because our politicians will not stop them.
So don’t fall into their trap.
Other forms of debt are rapidly growing as well…
Auto loan balances also contributed to the uptick, climbing by $13 billion over the course of the third quarter to $1.6 trillion. Student loan debt, meanwhile, increased by $30 billion while mortgage balances jumped by $126 billion to $12.14 trillion.
Overall, U.S. households are now more than 17 trillion dollars in debt.
I can’t even begin to describe how foolish we have been.
The only way to keep the party going is to borrow even more money, but thanks to higher interest rates we are not going to be able to purchase as much.
This is something that Kevin O’Leary pointed out in a recent interview…
“We’re looking at a downsized America. I tell it like it is,” O’Leary said on “The Big Money Show.” “Three years ago, even 24 months ago, you get a mortgage at 4.5%. You’re lucky to get one at eight today. So that means the size of the house you’re going to buy is 20 to 25% smaller. That’s a downsize.”
“You want to borrow for a car? Sorry, that’s 8 to 9%. Used to be five,” the O’Leary Ventures chairman added. “So, smaller, less expensive car. That’s happening at the same time.”
He is right.
But we just can’t help ourselves, and so we are going to continue to borrow more money.
The same thing is true for our corporations. Today, corporate debt is at the highest level ever recorded. And state and local governments continue to borrow money as if tomorrow will never come.
But the biggest offender of all is the federal government. The national debt is currently sitting at 33.6 trillion dollars, and it is constantly going higher. You can watch the national debt clock race upwards right here. To me, that debt clock is actually a countdown to the financial destruction of America.
Once upon a time, I warned that the U.S. would be paying a trillion dollars in interest on the national debt by the year 2030. Well, guess what? We got there early. According to Bloomberg, we have already crossed that ominous threshold…
Estimated annualized interest payments on the US government debt pile climbed past $1 trillion at the end of last month, Bloomberg analysis shows. That projected amount has doubled in the past 19 months from the equivalent figure forecast around the time.
The estimated interest expense is calculated using US Treasury data which state the government’s monthly outstanding debt balances and the average interest it pays.
Wow.
As usual, things are even worse than many of us were originally projecting.
Before I end this article, there is one more thing that I wanted to mention.
The “glitch” that affected the direct deposit of so many paychecks all over the nation still has not been resolved five days later…
Federal Reserve officials are urging banks to work with customers hurt by ongoing deposit delays that have prevented some people from accessing their paychecks and other funds.
A number of customers still haven’t received their direct deposit paychecks following a “human error” that damaged the plumbing of America’s banking system. The deposit delays are linked to a problem that emerged on Friday with the Automated Clearing House (ACH) payments system, causing headaches for consumers and employers.
“The Federal Reserve encourages banks to work quickly to resolve issues for customers experiencing delays in receiving direct deposit payments as a result of operational issues at a private sector payments provider,” a Fed spokesman told CNN in a statement.
Was it really a “human error” that caused this?
If someone just hit a wrong button, you would think that would be relatively easy to fix. Keep a close eye on the banks. As I discuss in my new book entitled “Chaos”, the banks are the beating heart of our economy and enormous trouble is brewing. Without healthy banks, our entire system will go haywire very rapidly.
We need to borrow money for just about every major purchase that we make, and it is the banks that make the vast majority of those loans. If the flow of credit starts to dry up, so will our standard of living. Unfortunately, a credit crunch has now begun, and that is going to have very serious implications for all of us.
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Bypass Big Tech Censors
Two Storms, One Harvest
Every food crisis in living memory has been a one-shock event. The 2008 price spike was a commodity bubble. The 2020 shortages were a logistics failure. The 2022 grain scare was a war on one exporter’s ports. Each time, the system bent, adjusted, and recovered, and each time the experts assured us afterward that global markets are simply too big and too diversified to fail.
What nobody in Washington seems eager to discuss is that 2026 is shaping up to be something the modern food system has never actually faced. Two independent shocks, one climatic and one geopolitical, are converging on the same harvest cycle at the same time. Not sequentially. Simultaneously.
Start with the weather. The Pacific Ocean is currently building toward what forecasters now openly call a record event. NOAA’s Climate Prediction Center puts the odds of at least a strong El Niño near 88 percent, with roughly two in three odds it reaches “very strong” status, the tier reserved for perhaps three or four events in the entire satellite era. Every major global model now projects a median peak in Super El Niño territory, and most of them project it exceeding the 2015-16 event, which until now held the modern record. Sea surface anomalies were already brushing the super threshold in mid-July, months before these events normally peak. The atmosphere has already shifted into El Niño mode, and the event is forecast to crest in late fall and early winter.
This is not about “climate change.” It’s about the standard cycles of weather, and the cycle we’re currently in is one that has likely devastated societies in the past. We’re better prepared as a society today, but not all Americans are equally prepared.
Serious households have started doing the quiet math on their own. Grocery bills tell part of the story, and the forecast maps tell the rest, which is why long-term food storage has moved from fringe hobby to mainstream line item in the family budget, with established suppliers like Heaven’s Harvest seeing demand from people who five years ago would have rolled their eyes at the idea. That instinct is not paranoia. It is pattern recognition, and the pattern is worth walking through carefully.
Editor’s Note: Heaven’s Harvest IS a sponsor, but the warnings of this article are real and would be written even if we didn’t have a survival food sponsor. With that said, those who take advantage of what they offer can use promo code “Patriot” for 15% off.
The Fertilizer Clock Is Already Running
While the Pacific warms, the second shock has been unfolding in the Strait of Hormuz. The conflict with Iran turned the world’s most important energy chokepoint into a contested waterway, and the consequences reach far beyond the gas pump. Roughly a third of global fertilizer trade moves through Hormuz, and the disruption sent urea prices up 86 percent year over year by March, with a 53 percent jump in a single month.
The World Bank projects energy prices rising about 24 percent in 2026 and fertilizer about 31 percent. By its own accounting, fertilizer prices ran 35 percent higher in the first five months of this year than the same period last year.
Here is the mechanism the nightly news will not explain. Fertilizer is not a grocery item. It is a time-delayed input. The nitrogen a farmer in Iowa or Punjab could not afford to apply this spring does not show up as a problem this spring. It shows up as a thinner harvest six to twelve months later.
The World Bank’s own food security brief concedes that the effects of reduced applications earlier this season “are likely to become visible only later in harvest outcomes.” Translate that from institutional language into plain English and it means this. The damage is already done, it is already in the ground, and we are simply waiting for it to arrive on the shelf.
Now check the calendar. Six to twelve months from the spring planting season lands us squarely in late 2026 and early 2027. Which is precisely when the strongest El Niño in the instrumental record is forecast to peak, bringing its signature droughts to Southeast Asia, Australia, southern Africa, northern Brazil, and South Asia, the very regions that grow the world’s rice, sugar, and oilseeds.
The World Bank warns openly that a strong El Niño “could disrupt multiple crop belts simultaneously” on top of the conflict-driven input costs. Their baseline projection assumes the Middle East disruptions ease by autumn. What in the last two years of Middle East history suggests that assumption is safe?
The System Has No Slack Left
The comfortable answer is that global markets always adjust. But adjustment requires slack, and the slack is gone. Global cereal production is expected to decline from last year’s records even before El Niño does its work. The UN World Food Programme, hardly a den of right-wing preppers, is calling this the most significant disruption to its supply chains since Covid and the invasion of Ukraine, and its supply chain director put the stakes bluntly.
Today’s supply chain challenges are tomorrow’s hunger crisis.
There is also a political dimension that markets cannot price. When food gets scarce, governments do not behave like economists. They behave like politicians. Export bans, hoarding mandates, and panic buying at the national level turned the modest rice shortfall of 2008 into a global crisis, and analysts are already warning that import-dependent nations are the first dominoes.
The 2015-16 Super El Niño, a far weaker event than what is now forecast, threw tens of millions into food stress across Africa and Asia. This one is projected to be stronger, and it arrives with fertilizer already rationed by price and shipping lanes already contested by missiles.
What Joseph Knew
Scripture does not treat preparation for lean years as faithlessness. It treats it as wisdom delivered in advance to those willing to act on it.
Behold, there come seven years of great plenty throughout all the land of Egypt: And there shall arise after them seven years of famine; and all the plenty shall be forgotten in the land of Egypt.
Joseph did not respond to that warning with a hashtag or a committee. He stored grain during the years of abundance, and when the famine came, Egypt stood while its neighbors begged. The lesson is not that famine is certain. It is that the time to prepare is precisely when preparation still looks optional.
Nobody who filled a pantry in a year of plenty has ever regretted it, and nobody standing in an empty aisle has ever been glad he waited for certainty.
None of this calls for panic, and panic is the enemy of sound judgment anyway. It calls for the same unglamorous prudence our grandparents considered ordinary. Keep some cash margin, know your local growers, and put real food in deep storage while it is cheap and available, because the entire arc of this story is that cheap and available is a closing window.
Families looking for a straightforward place to start can visit Heaven’s Harvest and use promo code Patriot for 15 percent off long-term storable food. The forecasts may yet soften, the strait may yet reopen, and we should pray they do. But hope is a fine thing to hold and a foolish thing to eat.