debt

A new stats from an industry report revealed that more consumers were in trouble paying on their credit cards and other debts during the first quarter of the year in view of increased prices for food and gas.

The report released by the American Banker Association shows that there was a deterioration compared to the prior quarters and described the most recent quarter as a "soft patch."

Jim Rogers, chief executive of Rogers Holdings, warned this week that the United States is approaching another ruinous crisis worse than that of 2008.

"The debts that are in this country are skyrocketing," he said. "In the last three years the government has spent staggering amounts of money and the Federal Reserve is taking on staggering amounts of debt.

US Vice President Joe Biden said Tuesday that the Congress is considering a new $1trillion project in deficit-cutting measures as part of a possible deal that would allow America to increase its borrowing authority before August 2 deadline.

"I think we're in a position where we'll be able to get well above $1 trillion pretty quick in terms of what would be a down payment on the process," Biden said after a three-hour meeting on Capitol Hill with top lawmakers.

According to the latest survey of the NABE economists the immense U.S. budget deficit is the gravest threat facing the economy, topping high unemployment and the risk of inflation or deflation.

47 member panel of forecasters of the National Association for Business Economics increased the estimate for the 2011 federal deficit to $1.4 trillion from $1.1 trillion in its previous survey in November.

Germany has changed its tone towards countries that contribute to the overall European debt saying that it remains committed to saving the euro zone. Germany’s finance minister ruled out the possibility that any country would ever be ejected from the European monetary union, and said calls to restore the Deutsche mark were “unrealistic nostalgia.”

Talking in an interview for CNBC a global head of foreign exchange strategy at HSBC David Bloom said that the United Sates will have to follow Europe's economic lead and face up to its debt problems instead of just continuing with quantitative easing that will lead to a dollar decline.

"Europe (is) facing up to its problems, looking into the abyss; the U.S. hasn't even started that process. That will take the dollar into trouble in the second half of next year," Bloom said.

The US and Japanese currencies rallied across the board during morning trades Asian on the weakening Asian stocks as investors are worried over the eurozone debt.

The yen that fell to a 1-week low of 84.53 against the Swiss franc in early Monday Asian deals reversed direction shortly and reached as high as 84.0 around 11:30 pm ET. The franc-yen pair is currently quoted at 84.04, up 25 pips from Monday's North American close.

Spot prices remained steady during Tuesday trades supported by physical buying as investors continued to watch the progress in euro zone's debt problem and tensions in the Korean peninsula for trading cues.

Uncertainties about how the euro zone would stabilise its fiscal conditions continued to bother investors, even after an agreement over the weekend on a $115-billion bailout package for debt laden Ireland.

The US second largest provider of funding for home mortgages Freddie Mac plans to lift some fees on loans it finances which shows there are greater risks even for borrowers making regular payments.

In the bulletin released this week the mortgage giant says it will some so-called "delivery fees" in March to cover increased risks on loans covering large portions of a property's value. The fees are charged to lenders, but will likely raise costs on many loans for both purchases and refinancings, including those already funded by Freddie Mac.

Gold prices moved up on Friday as concerns over Ireland's debt woes diminished and helped the euro strengthen against the dollar.

Spot gold gained half a percent to $1,359.65 an ounce by 0027 GMT, building on gains from the previous session.

U.S. gold futures also rose by half a percent, to $1,359.5.

Hopes that Ireland's debt crisis will be resolved soon lifted the euro against other major currencies.

Gold remained steady Tuesday as markets were closely watching the progress of the euro zone debt crisis, with a margin hike at CME weighing on sentiment.

Euro zone finance ministers will try to find a way to end Ireland's debt crisis on Tuesday, with Dublin resisting pressure to seek a state bailout by signalling that only its banks may need help.

As worries about Ireland dragged on, the dollar touched a six-week high against the euro.

America faces a bond market crisis that may fall upon the nation if it doesn’t properly address its massive budget deficits, warned former Federal Reserve Chairman Alan Greenspan.

"We've got to resolve this issue before it gets forced upon us," Greenspan said of the increasing U.S. debt levels.

His comments come as a panel, chaired by former White House chief of staff Erskine Bowles and former Senator Alan Simpson, is due to deliver a report on debt and deficits by December 1.

On Tuesday as concerns over euro-zone debt are impacting the euro gold further continued weakening.

A slight decline in ETF holdings also weighed on gold, which jumped to a lifetime high last week.

Spot gold XAU= fell 65 cents to $1,314.55 an ounce by 0332 GMT, down from a lifetime high around $1,320 hit last Friday. Gold has gained as much as 20 percent this year, partly driven by expectations the Federal Reserve would take fresh steps to aid the economy.

Yra Harris, a veteran trader at Praxis Trading, told CNBC that changes introduced to the US bankruptcy code in 2005 are coming back to haunt banks. He says that banks lobbied hard for changes to the bankruptcy code, but the legislation is now having the effect of encouraging consumers to do all they can to pay down their credit cards, while leaving their mortgage payments on the second place.

Capital One Financial Corp reported that US credit-card defaults continued their decline for the fourth straight month which means that fewer Americans were falling seriously behind in their credit card payments.

In its regulatory filing Capital One reported that the annualized net charge-off rate for US credit cards dropped to 8.13% in July from 9.28% in June.

The company said that accounts at least 30 delinquent declined to 4.66 percent from 4.79 percent.