U.S. households' financial burdens (payments for mortgage and consumer debt, auto leases, rents, homeowner's insurance, and property tax, all as a percent of disposable income, are at historically low levels and have not budged for over five years. Moreover, the overall leverage (total liabilities as a percent of total assets) of the household sector is at 30-year lows. Coupled with the fact that weekly claims for unemployment are at historically low levels, this paints a picture of a household sector that is on financially solid ground, more so than at any time in decades.
Today the Fed released data for the fourth quarter of 2016 covering various measures of household's financial burdens. As the chart above shows, financial burdens have been historically low for over 5 years, and are substantially less now than they were prior to the past 3 recessions. I note that consumer debt includes student loans, which now total over $1 trillion and which continue to grow at a significant pace—the only area of consumer finance that is deteriorating, thanks to our beneficent government which is willing to grant student loans with little or no regard for a student's ability to pay.
Households' leverage has plunged by about one-third since the 2008 recession, as the chart above shows, and leverage is now back to levels last seen some three decades ago.
Initial claims for unemployment, shown in the chart above, haven't been so low for a very long time. Workers at social security offices around the country must have a lot of time on their hands these days!
The chart above compares unemployment claims to total payrolls. Here we see that the chances of a worker getting laid off are as low as they have ever been, and by a substantial margin. In recent weeks, only about 0.15% of the U.S. workforce has been handed a pink slip.
Household finances appear to be about as solid as they have ever been, and job security is also about as good as it has ever been. This is not to say we don't have problems, but these statistics are reassuring nonetheless, and not widely recognized.