Evidence since mid‑2022 shows rising consumer credit and clear stress pockets, especially in credit cards and some auto and student loans, but not a full‑blown, systemic “ugly consumer credit bubble” that burst with a sharp correction, as described in the normalized prediction.

Key points:

• Rapid but not runaway growth in consumer borrowing. Federal Reserve G.19 data show total U.S. consumer credit outstanding rising from about $4.55T in 2021 to $4.89T in 2022 and $5.02T in 2023. Revolving credit (mainly credit cards) grew 15.1% in 2022 and 8.8% in 2023—fast, but not unprecedented.(federalreserve.gov)
• Record credit card balances but still a limited share of total debt. New York Fed reports show credit card balances hitting record levels (around $1.13T by Q4 2023, $1.14T by Q2 2024, and roughly $1.21T by Q4 2024 and into 2025).(newyorkfed.org) Even so, credit cards remain a relatively small slice of overall household debt compared to mortgages.
• Delinquencies did spike, but mainly in specific segments. By Q1–Q2 2024, about 8.5–9% of credit card balances and ~7.7–8% of auto loans were transitioning into delinquency annually, with serious credit card delinquencies (90+ days) reaching their highest level in over a decade (10.7% of card debt in Q1 2024).(newyorkfed.org) Lenders wrote off over $46B in delinquent card loans in the first nine months of 2024, the highest since 2010.(nypost.com) This is meaningfully stressful for lower‑income and younger borrowers, but it is not on the scale of a system‑wide credit collapse.
• Overall household delinquency rates remain moderate, and credit hasn’t crashed. Across all household debt, only about 3.2–3.6% was in some stage of delinquency in 2024, with the New York Fed repeatedly describing delinquencies as “elevated” but still near or below many pre‑pandemic norms, and noting that overall consumer financial health remains “solid.”(newyorkfed.org) There has been no sharp contraction in consumer credit outstanding; instead, total consumer credit has continued to edge higher through 2024 and into 2025, per G.19.(federalreserve.gov)
• No realized systemic crisis from consumer credit. Despite warnings from some commentators about a “credit bubble,” mainstream data and Fed communications do not indicate that consumer credit has created a systemic financial crisis akin to 2008. Household debt (even inflation‑adjusted) and overall delinquency rates remain below Great Recession extremes, and while subprime and younger borrowers are under strain, the banking system and broader economy have not undergone the kind of sharp, credit‑driven meltdown implied by a severe bubble thesis.(businessinsider.com)

Because the central features of the normalized prediction — a severe, systemic consumer credit bubble that then bursts in a sharp correction — have not materialized by late 2025, the prediction is best classified as wrong, even though it correctly anticipated rising balances and higher delinquencies in certain segments.