Judy Lagrou

Shares of Affirm Holdings (AFRM), the buy-now pay-later provider, fell by nearly 4% to close at $46.90 on Thursday. In the last month alone, Affirm’s stock has fallen by nearly 39%, amid a broader market selloff.  

This decline came despite recent announcements with resale marketplace StockX and online clothing retailer StitchFix. Affirm announced an offering of 22 million new shares, according to a recent 8-K filing from the Securities and Exchange Commission (SEC). The company’s drop in share price reflects a broader instability in the US stock market, brought about by recession fears and tariff changes announced by the federal government in recent weeks.

Despite market volatility, Affirm remains optimistic about its growth. At the Morgan Stanley Technology, Media, and Telecom Conference in San Francisco earlier this month, Affirm President Libor Michalek expressed confidence in the company, highlighting the platform’s 21 million active users. “We’re really pleased with the growth and the performance we’ve delivered,” he said.

Pat Suh, Senior Vice President at Affirm, also highlighted the company’s expanding merchant network in a recent press release: “In October through December [2024], fashion sales through Affirm were up 20% year-over-year,” Suh said. “To meet this increased consumer demand, we’re growing our network to include even more fashion merchants.” 

While Affirm’s leadership expressed confidence regarding the company’s direction, insider trading activity may suggest otherwise to investors. 

Form 4 filings submitted to the SEC last Tuesday reveal multiple insider transactions placed after the company’s recent equity offering. Most notably, Keith Rabois, a director on Affirm’s board, sold 16,088 shares for a total of $1 million. This sale came shortly after several Affirm executives – including Chief Operating Officer Michael Linford, President Libor Michalek, and Chief Financial Officer Robert O’Hare – exercised stock options of their own

Total credit card balances increased to $914 billion between July and December 2024, according to a report released by the Philadelphia Fed Wednesday. This figure represents the highest credit card balance since the Philadelphia Fed began tracking this data in 2012.

The percentage of credit card accounts making only the minimum payment each month also reached a 12-year high of 10.75%. “Consumers are not only spending more, leading to higher balances, but paying off less, increasing revolving amounts,” the report said.

This surge in credit card debt and consumers making only the minimum payments on their cards underscores growing economic pressures on American households. Already belabored by high interest rates and stubborn inflation, the high price of living has not abated as slowly as most Americans have hoped.

These concerning statistics on credit card debt come alongside the Federal Reserve’s decision to hold interest rates steady on Wednesday in an effort to slow inflation. While the Federal Reserve believes that their strategy has had “meaningful effects in bringing inflation under control,” Americans are experiencing a very different reality.

Case in point: 59% of credit card holders used their credit to purchase groceries in the last 3 months, according to a December 2024 report from PYMNTS Intelligence. The report further highlights that the most common use for credit among American consumers is purchasing essential household goods, not frivolous items.

“Inflation down to 2%…is what we’re trying to achieve,” said Federal Reserve Chairman Jerome Powell to reporters on Wednesday. “Consumers will pick that up, of course, in the things that they buy at the grocery store.”

American total household debt hit a record $18.04 trillion in the last quarter of 2024, propelled by a rise in credit card debt and auto loan balances, according to a new report released by the New York Federal Reserve on Thursday.

This increase in American debt – up $93 billion from the third quarter of 2024 – signals the persistent impact of rising inflation on household budgets. This impact was confirmed by a 0.5 percent increase in the Consumer Price Index (CPI) for January 2025 released Wednesday, which brought the total increase in CPI to 3 percent over the last 12 months.

Auto loans in particular, where American debt now totals $1.7 trillion, accounted for a substantial share of the household debt increase reported by the New York Fed. Outstanding auto loan balances increased by $11 billion over the third quarter of 2024. Delinquency rates of auto loans are also rising as more Americans struggle to keep up in the current inflationary environment.

Federal Reserve researchers highlighted high vehicle prices—an effect of the global pandemic—as a reason why so many American borrowers have fallen behind on their auto loan payments. Unlike mortgages, researchers say, auto loan payments impact a uniquely wide band of American consumers.

“Nearly all borrower groups have seen delinquency rates rise beyond their pre-pandemic levels,” New York Federal Reserve analysts reported.

The report from the New York Federal Reserve also indicated a specific spike in auto loan debt among Americans aged 18-29. A sharp rise in auto loan delinquencies continues to impact those in lower income brackets, where young Americans are most likely to fall.

“For auto loans, higher car prices combined with higher interest rates have driven monthly payments upward and have put pressure on consumers,” New York Federal Reserve analysts reported in a February 2025 blog post.