U.S. households overall have been managing their personal finances well. On average, debt burdens appear to be at manageable levels, and delinquency rates on consumer loans and home mortgages have been lowReally? That is news to me. How about the Negative US Savings Rate? This is exactly the time where you would expect a high savings rate, as retirement is fast approaching for tens of millions of baby boomers .
In the very same speech Mr. Bernanke talks about the 'democratization of credit ' and goes on to say "Payday lending outlets, a source of credit that was almost non-existent a decade ago, now number more than 10,000." The explosion of payday lending outlets is NOT something to cheer. These payday lending outlets cater to low income people who are often living paycheck to paycheck.
In large part, American's personal finances are in a sorry state. Mr. Bernanke states "U.S. households overall have been managing their personal finances well." Mr. Bernanke is wrong here, and the doubts about his leadership have thus grown.