Who knew debt could be catching?

By Lee Russ

Friday, February 17, 2006 at 04:14 PM

"In its Financial Risk Outlook 2006 survey, the regulator warns that a growing minority of consumers are risking financial ruin as a result of their burgeoning personal debts."

America? Nope.  The UK, according to Monsters & Critics in a late January news piece which includes the statement that, "The UK's leading financial regulator, the Financial Services Authority (FSA), has warned that spiralling levels of consumer debt could destabilise the UK economy."

Apparently the U.S.-U.K. "special relationship" is so close that they can catch our fiscal insanity like the flu.

The piece begins "In its Financial Risk Outlook 2006 survey, the regulator warns that a growing minority of consumers are risking financial ruin as a result of their burgeoning personal debts."

The result is that "the FSA suggested that rising unemployment or a rise in interest rates could see many households default on payments and called on banks to tighten their lending requirements, warning that the credibility of the industry was at stake should lenders be seen to be acting irresponsibly."

The piece concludes that "The fact that such a high-profile body as the FSA has issued such an explicit warning about consumer debt is indicative of growing concern about consumers' apparent willingness to take on increasingly large debts, despite repeated warnings about the dangers of doing so."

And why wouldn't the Brits be willing to "take on increasingly large debts, despite repeated warnings about the dangers of doing so"???  They only have to look to their American cousins to see that debt saturation doesn't really mean much.  Yet.