CHART OF THE WEEK: US savings are at the lowest level since the 2008 Financial Crisis
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CHART OF THE WEEK: US savings are at the lowest level since the 2008 Financial Crisis
US consumers pile into debt to maintain spending as savings have been almost entirely depleted
US net savings by households, businesses, and the government as a % of GDP have been negative for 6 straight quarters. This is the longest streak since the Great Financial Crisis.
In other words, Americans are producing much less than they consume. Since 1947, this has not happened outside of the pandemic and the Financial Crisis.
Right now, only foreigners’ net savings have been holding up the economy somewhat but they have been also falling. Additionally, as savings have been depleted, US consumers pile into debt as never before.
This is not a sign of strong economy.
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