As I research investment themes for next year, I quickly find myself surrounded by tons of fundamental and economic data some of which can be disturbing. Of all the econ data that I run across, the one piece that reallys catchs my eye is Federal Reserve's Household Debt Service Payments as a % of Diposable Personal Income. I checked the data going back to the early 80's and noticed the enormous boom...
Interesting data is it not? I am of the opinion that at some point the consumer will have to pony up the cash to pay down this debt. The increasing interest rates will force the consumer to do just that...as a result, I would play consumer services stocks very carefully over the next 12 months. My initial consideration is to set an underweight status on the entire sector.
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