A story today of mounting credit card debts suggests Americans are profligate spenders but I'm not so sure. Here is part of the story:

The value of credit card accounts at least 30 days late jumped 26 percent to $17.3 billion in October from a year earlier at 17 large credit card trusts examined by the AP. That represented more than 4 percent of the total outstanding principal balances owed to the trusts on credit cards that were issued by banks such as Bank of America and Capital One and for retailers like Home Depot and Wal-Mart.

At the same time, defaults — when lenders essentially give up hope of ever being repaid and write off the debt — rose 18 percent to almost $961 million in October, according to filings made by the trusts with the Securities and Exchange Commission.

Serious delinquencies also are up sharply: Some of the nation's biggest lenders — including Advanta, GE Money Bank and HSBC — reported increases of 50 percent or more in the value of accounts that were at least 90 days delinquent when compared with the same period a year ago.

The AP analyzed data representing about 325 million individual accounts held in trusts that were created by credit card issuers in order to sell the debt to investors — similar to how many banks packaged and sold subprime mortgage loans. Together, they represent about 45 percent of the $920 billion the Federal Reserve counts as credit card debt owed by Americans

I think if you put these two pictures together, that in the book and the one you read in these sorts of articles and reports, the picture is radically different. It's one of many Americans who have no reserves whatever. Who are always on the ratty edge of being on the street.

They use credit cards the way people used to use savings — whatever is left on their credit line is used as a cushion for emergencies and crises.

They may put their mortgage payment on a credit card at times.

Now these folks are seeing their homes go into a negative equity situation. Once again, they have nothing.

They are already in a Great Depression.

I think this has very strong social consequences that we can only begin to fathom. But my concern is chiefly getting people out of debt. Debt relief. There are simple ways of dealing with overwhelming debts. Let's recap:

1. Don't increase your credit card debts. Tear up your credit cards like Dave Ramsey suggests if you have to. But don't increase your balances.

2. Decide how much you can afford to pay on old debts.

3. Put offers together for all your unsecured debts. Offer to pay whatever you can in order to pay all or part off over 36, 48 or at most 60 months, and require the creditors to report positively about your credit after the 12th month of your honoring the agreement.

4. Get on with your life without the crushing burden anymore. You will be applying a reasonable amount of your income to old debts and no longer be a debt slave.

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