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Obama Says So
November 7th 2009 Economy, Obama, Lies and Liars

Are Americans Really Saving More? - Hit & Run : Reason Magazine

Depends on how you look at it, I guess.

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Comments on this post:

  • J.S. Bridges
    November 7th, 2009 | #1

    Looks like they’re doing a bit better than a year or so ago; otherwise, eh…

    Just lately, that lil’ “unemployment” thingy is kind of curtailing my personal savings rate, just a bit.

  • Haverwilde
    November 7th, 2009 | #2

    I believe this is just an aberration. The long term employed and successful folks are continuing to save. The mass of now unemployed, but previous non-savers, still are not saving but the ‘percent of income’ skews the data.

  • Erbo
    November 7th, 2009 | #3

    Is this really “savings”? The government definition of “savings” in this case is “excess of income over expenditures,” but is that money really being “saved,” or just going to pay down debt? (Which is a good thing for individuals, but a bad thing for the economy, as the money that pays down debt doesn’t get used to buy stuff.)

  • Lorenzo
    November 7th, 2009 | #4

    Good point, erbo. If Americans are paying down debt, it could be demonstrated by another graph showing the growth of debt over the earlier part of the period, and the extent of the recent paydown. Somehow, I suspect the paydown is going to be a blip compared to the rest of the graph, just like the savings rate.

  • kennycan
    November 8th, 2009 | #5

    the money that pays down debt doesn’t get used to buy stuff.

    Sure it can. If a debtor pays a lender what is owed, the Lender now has that money to buy stuff.

    Also, shouldn’t your “savings” be considered net of debt? I am constantly reminded of the person that says (to Suze Orman sometimes, but in other settings as well) I have 100k savings (in stocks, the bank, bonds etc) but when pressed they reveal they have 75k of mortgage debt and 25k of credit card debt. Even more amazingly they are 55 years old and are asking Suze how they can retire at age 60!!! They are already spending beyond their means while they have employment income coming in as evidenced by their mounting credit card debt (bet that mortgage debt was an equity takeout as well). What’s going to happen when they actually retire?

    the extent of the recent paydown

    Private individuals may have been paying down their debt, but the Federal and State governments have been doing their share to reborrow that money on your behalf. Overall indebtedness of the public and private sectors in the US has not gone down. YMMV (depending upon whether you pay taxes. You’ll be paying your share plus someone else’s if you do).

    Does anyone have a statistic for the “net new savings less the net new debt created”? That’s our really big problem in the US (as in all socialist systems).

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