Consumers have been racking up credit card debt at a pace not seen since the period leading up to the 2008 credit market collapse. And that has experts worried.
"This is a huge red flag," said Odysseas Papadimitriou, chief executive of CardHub, a credit card comparison and personal finance company.
Americans appear to be spending like it's 2007 as they charged up $70.9 billion in new debt on their credit cards in 2015, according to CardHub's 2015 Credit Card Debt Study, released this week. The lion's share came in the fourth quarter, when consumers charged up $52.4 billion in new debt.
"It's the largest fourth-quarter debt buildup since the Great Recession [of 2008] - 42% higher than the post-recession average," said Papadimitriou. "During this one quarter, we added more credit card debt than the fourth quarters of 2009, 2010 and 2011 put together."
The report shows total outstanding credit card debt was $917.7 billion in 2015. The last time total debt breached the $900 billion mark was in 2007. On a personal level, the average household with credit card debt now owes $7,879, which is the highest balance since the 2008 recession, when the average level hit $8,400 and the credit markets imploded.
"All of this has us wondering if 2016 will be the next 2008 for the credit markets," the report said.
Of course, the 2008 credit crisis was exacerbated by the housing meltdown, which isn't the case today. Still, Papadimitriou sees this current level as a dangerous tipping point. "Incomes haven't risen that much in the past ten years," he said. "Once you get into that tipping point, where you cannot make your payments anymore, then it all goes into a downward spiral and gets out of control very fast."
Consumers appear to be reverting back to old spending habits.