AMERICAN consumers’ long-running love affair with debt is on the rocks. And as they repent for their credit-driven Bacchanalia, the foundering U.S. economy is left to pick up the pieces.

    Anita Bullock-Morley, a 36-year-old speech therapist in Atlanta, the United States, is one who talks about her old borrowing habits like a recovering drug addict: “My life is so much better not having that haunting debt.”

    She used savings to help pay for her wedding last year. And after wiping out the balance on two dozen credit cards and swearing off boutique-label purchases and fancy vacations, she is working her way through US$50,000 in student loans and the US$215,000 left on her mortgage. Bullock-Morley is among a generation of Americans who were taught the value of saving as children but had to learn the hard way how to spend wisely.

    Since the financial crisis erupted, millions of Americans have ditched their credit cards, accelerated mortgage payments and cut off credit lines that during the good times were used like a bottomless piggybank. Many have resorted to a practice once thought old-fashioned — delaying purchases until they have the cash.

    As a result, total household debt, through payment or default, fell by US$1.1 trillion, or 8.6 percent, from mid 2008 until the first half of this year, according to the Federal Reserve Bank of New York.

    Financially sound individuals and families are important to the overall stability and growth of the U.S. economy, Federal Reserve Governor Elizabeth Duke said Saturday.

    “The Federal Reserve has an inherent interest in the financial stability and strength of individual households, whose spending, saving, and investing significantly impact economic growth,” Duke said, while encouraging consumers to create a financial plan, save money through automatic withdrawals for retirement, create an emergency fund and manage debt.

    Meanwhile, U.S. regulators closed four banks Friday, bringing the total number of closures this year to 84. The largest of the failed banks, the Community Banks of Colorado, had US$1.38 billion in assets and US$1.33 billion in total deposits as of June 30, the Federal Deposit Insurance Corp. said. It is the largest bank to fail since Aug. 19. (SD-Agencies)