US Total Debt By Major Segment – Where Is The Deleveraging?

From the March 8, 2012 Federal Reserve “Flow of Funds” report for 2011 Q4:

“At the end of 2011, the level of domestic nonfinancial debt outstanding was $38.3 trillion, of which household debt was $13.2 trillion, nonfinancial business debt was $11.6 trillion, and total government debt was $13.5 trillion.

Household net worth—the difference between the value of assets and liabilities—was $58.5 trillion at the end of 2011, about $1.2 trillion more than at the end of the third quarter. For 2011 as a whole, household net worth fell close to ¾ percent, the first annual decrease since 2008.”

Total Federal Public Debt and Total Credit Market Debt Indexed to January 1, 1966

Credit market debt had a temporary decrease due to the 2008 market debacle, but is once again at record levels.  Federal public debt just kept going up without any decrease.


Rate of Change of Debt by Major Segment by Year

The rate of expansion of total debts has slowed, but total debt has not decreased.  The rate of change per quarter in 2011 was progressively higher.  Households reduced debt in 2009, 2010 and 2011, but increased debt in Q4 of 2011.  Businesses decreased debt in 2009, but have increased in each period since then.  State and local governments increased debt in 2009 and 2010, but decreased debt in 2011.  The federal government dramatically increased debt in 2008, 2009, 2010, and 2011; but at a lower rate in each of those years.  However, in Q3 and Q4 of 2011, the federal government stepped up the rate of debt accumulation.


Total Debt By Major Segment Indexed to January 1, 1966

This chart plots total debt of households (green), non-corporate / non-farm businesses (orange), corporate /non-farm businesses (blue), state and local governments (red), federal public debt (black).

Households and non-corporate/non-farm businesses have deleveraged.  State and local governments have held the line.  Corporate/non-farm businesses temporarily deleveraged, but then ramped up to new highs.  The federal government  increased debt and also accelerated its growth.


Farm Debt Follows a Much Different Pattern:

This chart of farm debt shows a much different pattern than debt for other major segments.  It took a steep dive in the 1980’s, but that aside, farm debt has not decreased from pre-recession levels.


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