Real estate and economy commentator Michael Bordenaro says two trends are flashing trouble in the economy right now, and one of the clearest may be showing up in pawn shops.
In his latest video, Bordenaro argues that short-term pawn loans are climbing because more people are running out of room in their monthly budgets. He ties that shift directly to rising gas prices, saying fuel costs hit households immediately and leave less money for everything else.
That matters because pawn shops tend to show distress faster than many traditional economic reports. As Bordenaro explains, someone can walk into a pawn shop with a valuable item and leave with cash the same day. There is no long application process, no credit check, and no waiting around for approval.
When that kind of borrowing starts rising, especially for basic living expenses, it says something important. It usually means people are not borrowing to splurge. They are borrowing to stay afloat.
And that is exactly the case Bordenaro makes here.
Why Gas Prices Are Hitting So Hard
Bordenaro says the recent jump in gas prices has pushed many households over the edge in a very short time.
He points to average gas prices rising from about $2.98 a gallon to roughly $4.16 a gallon while he was recording the video. In his view, that type of increase acts like an instant tax on the public because it cannot really be delayed or avoided. People still have to get to work, take kids to school, run errands, and keep life moving.
That is why he sees pawn shop activity as such an important indicator. Unlike other bills that may be put off for a few days, fuel costs show up the moment someone pulls into a gas station.
Bordenaro says pawn shop owners in Idaho and California have been hearing the same basic story from customers. People need money for bills. People need money for gas. People are not coming in for luxury spending. They are coming in because the cost of living is squeezing them.
That is a pretty blunt signal. When households start pawning jewelry and watches just to cover transportation and utility costs, the problem is no longer abstract.
It is already here.
What Pawn Shops Are Seeing Now
According to Bordenaro, about 25% of pawn shops reported more activity this year than last year, while only 12% reported less.
He says the typical pawn loan right now is around $200 to $300, though customers are increasingly bringing in higher-end items. That includes watches, gold jewelry, and other valuables that can secure more meaningful short-term cash.
Bordenaro also walks through how the business works. A customer might bring in a necklace worth $2,000 and receive a loan for only a fraction of that, maybe $800. If the borrower repays the loan with interest within the set time period, they get the item back. If not, the pawn shop keeps it and resells it.
Either way, the shop makes money.
That is why Bordenaro says pawn shops often do well when the broader economy does not. When regular financial conditions weaken, this kind of business tends to pick up.
He also notes just how expensive these loans can be. Interest can range from 3% to 25% per month, which can annualize to something close to 300% APR. Nobody takes that kind of loan because it is a smart long-term financial plan. They take it because they need cash immediately.
That alone tells you the borrower is under pressure.
The Behavior Change May Be Even More Important Than The Loans
One of the more troubling points in Bordenaro’s report is not just that more people are using pawn shops. It is how they are using them.
He says customers are not only pawning more expensive items, but are also asking for more repayment extensions. More are defaulting. Some are selling items outright instead of borrowing against them.
That last point may be the clearest sign of all.
If someone sells an item instead of pawning it, Bordenaro says that likely means they do not believe they will be able to repay the loan and recover the item later. They need the most cash they can get right now, and they are willing to let the item go for good.
He also says some customers are caught in a repeat cycle. They pawn an item, pay off the loan, get the item back, and then come back a few weeks later to pawn the same item again.
That does not sound like a one-time emergency. It sounds like ongoing cash-flow trouble.
And that is what makes this trend more serious than a temporary rough patch. If the same households keep returning to the same assets just to make it through the month, that suggests the underlying math of daily life is no longer working.
Surcharges Are Adding To The Pressure
The second warning sign Bordenaro highlights is the spread of surcharges.
He says businesses across multiple industries are increasingly adding extra fees instead of simply raising listed prices. Consumers are seeing credit card surcharges, restaurant service charges, airline baggage fees, hotel resort fees, delivery app fees, and shipping surcharges.
In his view, this is just another way businesses are passing along higher costs without making the sticker price look worse upfront.
He notes that 34% of small businesses now charge credit card surcharges, and about one in five restaurants nationwide add some form of service charge or similar fee. He also says this practice is becoming more common in airlines, retailers, hotels, delivery platforms, and shipping.
The reason this matters is simple. It changes how people experience inflation.
A higher base price is one thing. A surprise fee at the end of a purchase feels different. It feels sneaky. And Bordenaro argues that this kind of layered pricing is helping fuel consumer frustration and distrust.
He gives an example from a sushi restaurant in Miami Beach where a happy hour oyster special he used to buy went from $7 for three oysters to $12 in about a year. That pushed the effective cost of a dozen oysters from $28 to $48.
Whether that increase comes through menu pricing or fee layering, the customer still pays more.
That is the point he keeps coming back to.
Why These “Temporary” Costs Usually Stick Around
Bordenaro says once businesses realize customers will tolerate a surcharge or price increase, those extra costs usually do not disappear.
He points to older examples like airline baggage fees, rental car surcharges, and restaurant fees that began years ago during periods of higher cost pressure and then never really went away.
That is probably one of the more realistic parts of his analysis.
Temporary fees have a habit of becoming permanent revenue. Once a company learns it can charge more without losing too many customers, there is very little incentive to reverse course. That may be basic business logic, but it is still hard on consumers already under strain.
Bordenaro argues that the end result is a public that feels nickeled-and-dimed from every direction while incomes fail to keep pace.
That helps explain why he also points to weak consumer sentiment. He says the latest University of Michigan sentiment reading is near record lows, with the public feeling deeply pessimistic about the economy.
Gas prices are a major part of that story, in his telling, but they are not the whole thing. Weak hiring, higher living costs, and the sense that every transaction now comes with another fee are all feeding the same mood.
A Stress Signal, Not A Side Story
Bordenaro’s larger point is that pawn shop activity and surcharge creep are not random side stories. They are signals.
They suggest a lot of households are running out of buffer. Not necessarily all at once, and not always in dramatic fashion, but in the slow, grinding way that changes behavior first. People borrow faster. They sell valuables sooner. They stop assuming next month will be better.
That is why the pawn shop trend stands out.
When more people are willing to hand over a watch, a necklace, or some other personal item for a high-interest short-term loan just to make the bills work, it usually means the economy is feeling much worse on the ground than many headline numbers suggest.
And when those same people come back again to pawn the same item a few weeks later, it becomes even harder to argue that this is just a passing squeeze.
Ed spent his childhood in the backwoods of Maine, where harsh winters taught him the value of survival skills. With a background in bushcraft and off-grid living, Ed has honed his expertise in fire-making, hunting, and wild foraging. He writes from personal experience, sharing practical tips and hands-on techniques to thrive in any outdoor environment. Whether it’s primitive camping or full-scale survival, Ed’s advice is grounded in real-life challenges.
