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Ed Meek
CEO/Investment Advisor

Edge Portfolio Management


State: IL

At Edge, a low client to advisor ratio allows for personal and customized service for each individual.  Our goal is to work as a team for each client to provide not only portfolio management but wealth coordination and financial planning.  We make every effort to have frequent communication with our clients and to provide timely response to calls and emails.  I also enjoy spending time with my wife and three kids, playing and following basketball, playing golf, and participating as an advisory board member for Breakthrough Urban Ministries.

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Consumer Debt Falls in Q3

Consumer debt falls as Americans continue to cut up credit cards and pay down mortgages. What's driving them?

| BY Adriana Reyneri

 Total consumer debt fell by $60 billion to $11.66 trillion in the third quarter of 2011, according to new federal data that shows Americans continue to cut up their credit cards and pay down mortgages in response to the economic and housing crises.

 Total consumer debt fell 0.6 percent, down from $11.72 trillion in the second quarter, according to the Quarterly Report on Household Debt and Credit released yesterday by the Federal Reserve Bank of New York.

 “The decline in outstanding consumer debt reveals that households continued to try and deleverage in the wake of a challenging economic environment and large declines in home values,” said Andrew Haughwout, vice president of the Research and Statistics Group at the New York Fed.  “However, our findings also provide evidence that consumer credit demand continues to increase, a positive sign for consumer sentiment.”

 Mortgage balances fell by 1.3 percent to $114 billion over the third quarter, while home equity lines of credit increased by 2.3 percent, or $14 billion, said the Fed. Debt not related to real estate rose 1.3 percent to $2.62 trillion.

 Americans continued to close credit card accounts in the third quarter, reducing the number of open accounts by 6 million to 383 million. The number of open accounts was about 23 percent below the peak reached in the second quarter of 2008, and balances on those cards were nearly 20 percent below the record levels reached in the fourth quarter of 2008.

 The desire to reduce consumer debt, save more and borrow less cuts across all wealth levels, according to an October survey of 843 affluent investors conducted  by Millionaire Corner. Nearly one-third of the investors –who have a net worth starting at $100,000 – said they have increased their savings because of the economic downturn and nearly 30 percent said they have paid down debt. The trend holds true for the wealthiest investors – those with a net worth of at least $1 million not including primary residence. Nearly 32 percent of Millionaires said they are saving more, and more than 19 percent are reducing their debt due to recession and its aftermath.

 Increased stock market volatility has also had a chilling effect on consumer spending, according to the results of our November survey of 1120 investors. More than half of investors with a net worth of  $100,000 to $500,000 – not including primary residence – said they have reduced spending over the past few months due to stock market volatility. The same is true for 30 percent of Millionaires, who also say they are reducing spending for luxury goods (25 percent), are using products longer (41 percent) and are being more selective in shopping and watching for deals (60 percent).

  An indicator of consumer credit demand – credit account inquiries within six months – increased for the second consecutive quarter, according to the New York Fed.

 Overall delinquencies on consumer debt rose 0.2 percent to 10 percent in the third quarter. About $834 billion in consumer debt is more than 90 days behind on repayment schedules. Delinquencies on current mortgage balances increased, reversing a recent trend of reductions in delinquencies. New foreclosures fell 7 percent from the second to the third quarter, and bankruptcies declined 18.8 percent year-over-year.