Pandemic Savings Depleted: Economic Uncertainty Looms as American Debt Rises

During the pandemic, Americans saved an impressive $2.1 trillion, fueling sustained consumer spending and economic resilience amidst rising interest rates and persistent inflation. However, recent reports from San Francisco Federal Reserve economists Hamza Abdelrahman and Luiz Edgard Oliveira indicate that these pandemic-era savings are now depleted, with many Americans having more debt than savings as of March 2024. This shift from savings to debt raises concerns about the future of consumer spending, which is a key driver of the U.S. economy. With the depletion of excess savings and an increase in consumer debt and delinquencies, there are growing worries about potential economic downturns.