Is this a prelude to America’s 2026 credit crisis?
America could be approaching a credit and financial crisis by 2026, driven by rising consumer and corporate debt, increasing defaults, and signs of fraud within parts of the lending system.
That’s according to MarketWise founder Porter Stansberry, who warned that credit is deteriorating unusually early in the cycle, even before unemployment has risen significantly.
Stansberry pointed to mounting consumer credit stress: subprime auto delinquencies have surpassed their 2008 peak, credit-card delinquencies have reached the highest levels since recordkeeping began, and auto repossessions are at a 15-year high.
He also cited Carvana’s sharp stock decline as a sign of distress in subprime auto lending and the bankruptcy of Tricolor Holdings, a subprime auto lender accused of fraudulent practices, as examples of broader vulnerabilities in the sector.
“Obviously, these kinds of credit problems — when defaults occur before recessions — are far, far more dangerous to the financial markets,” Stansberry wrote.
“It’s an obvious indicator that something is badly broken in the underlying, real economy.
He noted that the deterioration has been years in the making. Since around 2015, federal debt has doubled, corporate debt has risen by roughly 65%, and consumer debt has increased by nearly 50%.
Consumer stress points are building
Stansberry’s note highlights mounting signs of consumer strain as more Americans face rising living costs and heavier debt burdens.
He warns that the next downturn could be credit-led, with consumer defaults acting as the spark that spreads weakness across the broader economy.
According to the New York Fed, American credit card debt rose by another $27 billion in the second quarter, reaching a record $1.21 trillion. At the same time, delinquency rates remain elevated, Fed researchers noted.
Households on the lowest income rungs are facing the most pain, with subprime loan delinquency jumping to 8.3% in September, the highest since 2010, according to data from Equifax and Moody’s Analytics.
“Subprime borrowers are indeed suffering serious financial stress,” wrote Moody’s Analytics chief economist Mark Zandi.
There has been much handwringing about the increasing credit problems of subprime borrowers and the fallout on the financial system and economy. Subprime borrowers are indeed suffering serious financial stress. The delinquency rate on subprime loans (loans to borrowers with below… pic.twitter.com/gxvwfQYNiJ
undefined Mark Zandi (@Markzandi) October 20, 2025
Adding to those pressures, Stansberry pointed to an emerging rise in AI-driven white-collar unemployment, which is making it harder for displaced workers to find new jobs.
For the first time since 2021, there are now more job seekers than available positions, underscoring a gradual softening in the labor market.
The problem is particularly acute among younger workers, whose unemployment rate has climbed sharply over the past year.