Consumer spending can look perfectly healthy long after household budgets start to buckle, and a major nonprofit credit counselor just logged numbers that expose the gap between what Americans are buying and what they can actually afford.
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Consumer spending can look healthy long after household budgets start to buckle. A purchase financed with borrowed money still registers as a sale, but it also creates a claim on tomorrow’s paycheck. For investors, the danger is mistaking spending that depends on fresh borrowing for demand that can sustain itself.
That is why America’s debt crisis deserves…