Kanye West once said he was $53M in debt and asked Mark Zuckerberg for a $1B investment

Vawn Himmelsbach
Kanye West once said he was $53M in debt and asked Mark Zuckerberg for a $1B investment
Kanye West once said he was $53M in debt and asked Mark Zuckerberg for a $1B investment

Kanye West is known for a lot of things. He’s considered a trailblazing rapper, as well as a producer, entrepreneur and fashion designer. But he’s perhaps just as well known for his high-profile celebrity disputes and far-right tirades — plus that failed marriage to Kim Kardashian.

While West — who officially changed his name to Ye — fell off Forbes’ billionaires list in 2023, he’s still estimated to be worth about $400 million.

But, back in February 2016, West claimed to be $53 million in debt and in a series of now-deleted tweets called on Facebook founder and CEO Mark Zuckerberg to invest $1 billion in “Kanye West ideas … after realizing he is the greatest living artist and greatest artist of all time.”

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He also made an appeal to former Google CEO Larry Page and accused Silicon Valley’s billionaires of not doing enough. He wrote, “All you dudes in San Fran play rap music in your homes but never help the real artists. You’d rather open up one school in Africa like you really helped the country…if you want to help… help me…”

It's worth noting that later that year West was diagnosed with bipolar disorder and hospitalized for a psychiatric emergency.

Even multi-millionaires like West can spiral into debt, so it’s not surprising that money management can be a challenge for Americans living on a whole lot less.

Consumer debt is on the rise

Total household debt in the U.S. rose by 1.3% to reach $17.29 trillion in the third quarter of 2023, according to the latest numbers from the Federal Reserve Bank of New York. (That 1.3% is equivalent to a whopping $228 billion.)

In general, Americans have four main types of debt — housing, auto, student loan and credit card — and all grew in Q3 2023. Mortgage balances and balances on home equity lines of credit (HELOC) were $12.49 trillion. Meanwhile, non-housing debt was a total of $4.8 trillion.

Why is consumer debt rising?

Many Americans are burning through the money they squirreled away during the COVID-19 pandemic, according to JPMorgan research reported on by Business Insider. Combine that with persistent inflation and soaring interest rates, and there’s worry that we could (still) be in for a recession.

Credit card balances, which saw a 4.7% increase in Q3 to $1.08 trillion, actually declined during the pandemic. A report from the U.S. Government Accountability Office (GAO) found that “many people likely used their pandemic stimulus payments to pay down their credit card balances.”

Read more: Retire richer — why people who work with a financial advisor retire with an extra $1.3 million

Low interest rates also helped to improve household cash flow, with about 14 million households refinancing their mortgages in 2021. Those with student debt also benefited from a temporary pause on federal student loans.

“The period of very low interest rates that supported many of these developments is decidedly over, at least for now, suggesting that household finances will likely tighten further in the coming months,” according to October 2023 analysis from New York Fed economists. And there’s “tremendous uncertainty” about how much is left of household excess savings.

Credit card delinquencies — which saw historic lows during the pandemic — surpassed pre-pandemic levels in Q3 2023. Nearly 50% of credit cardholders are carrying a balance from one month to the next as of November, according to a recent survey, up from 31% in 2021 and 47% in July of last year.

And the resumption of student loan payments in October after a more than three-year pause could “have substantial negative effects on vulnerable households,” said the New York Fed economists.

Are we in for a recession?

Three in four economists believe the chance of a recession in the next 12 months is 50% or less, according to a December 2023 survey from the National Association for Business Economics (NABE). They also anticipate a slowing in inflation (though, unfortunately, not with food or energy costs), while 80% expect interest rate cuts to begin this year — likely in the second or third quarter.

But it’s those who are most vulnerable that are likely to pay the price.

“Overextended consumers have the least cushion to soften the blows from rising interest rates and weather the corrosive effect of inflation on income and affordability, as well as other economic headwinds,” according to analysis from S&P Global.

The average American probably doesn’t have the same extravagant expenses as Kanye West, who proposed to Kim Kardashian in 2013 by renting out AT&T Park in San Francisco — complete with a live performance by the Chicago Symphony Orchestra.

But, in uncertain economic times, it’s a good idea to cut back on unnecessary spending, double-down on paying debts and make sure you have enough emergency savings.

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This article provides information only and should not be construed as advice. It is provided without warranty of any kind.

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