Comments on: Let’s get our savings rate back in the black http://sensetosave.com/2008/02/22/lets-get-our-savings-rate-back-in-the-black/ Sun, 14 Mar 2010 19:16:20 -0600 http://wordpress.org/?v=2.8.4 hourly 1 By: This Morning’s Rambling Rant | Commuter Chronicles http://sensetosave.com/2008/02/22/lets-get-our-savings-rate-back-in-the-black/comment-page-1/#comment-5296 This Morning’s Rambling Rant | Commuter Chronicles Sat, 23 Feb 2008 21:57:34 +0000 http://sensetosave.com/2008/02/22/lets-get-our-savings-rate-back-in-the-black/#comment-5296 [...] I did make it to my stop and now I’m here trying to win EC’s from Joe Tech , hoping I had the sense to save this week and wondering what would Simon Cowell say about my blog or about my other site Poetical [...] [...] I did make it to my stop and now I’m here trying to win EC’s from Joe Tech , hoping I had the sense to save this week and wondering what would Simon Cowell say about my blog or about my other site Poetical [...]

]]> By: Pete @ biblemoneymatters http://sensetosave.com/2008/02/22/lets-get-our-savings-rate-back-in-the-black/comment-page-1/#comment-5293 Pete @ biblemoneymatters Sat, 23 Feb 2008 19:19:33 +0000 http://sensetosave.com/2008/02/22/lets-get-our-savings-rate-back-in-the-black/#comment-5293 Some scary things to think about from the post, and the commenters. Why is it that people feel the need to spend spend spend? Is it the rush they get from pulling out that plastic and getting that new tv? or is it the need to keep up with the joneses? Some scary things to think about from the post, and the commenters. Why is it that people feel the need to spend spend spend? Is it the rush they get from pulling out that plastic and getting that new tv? or is it the need to keep up with the joneses?

]]> By: Cromely http://sensetosave.com/2008/02/22/lets-get-our-savings-rate-back-in-the-black/comment-page-1/#comment-5269 Cromely Fri, 22 Feb 2008 17:59:01 +0000 http://sensetosave.com/2008/02/22/lets-get-our-savings-rate-back-in-the-black/#comment-5269 The problem is that the economic growth we've had over the past decade seems largely driven by consumer spending. The reason the economy didn't drop into recession a few years ago is because people didn't save -- they spent money on all sorts of stuff. Greater savings would result in lower consumer sales which would translates into recession early. The problems are two fold. First, a significant portion of that spending has gone to overseas manufacturers, rather than being fed back into manufacturers and labor in the US, to be then spent on more consumer goods in the US. The second is that it seems we've built a giant Ponzi scheme to keep the economy going. We can stay out of recession as long as people keeping acquiring debt to drive the economy forward. Eventually, though, credit dries up, less money comes in from consumer spending and we end up in recession or worse. Increasing savings is exactly what individuals should be doing. Unfortunately, if people do what they should, we are likely to have problems at the national level. I don't want to see a recession, but that may be what it takes to reboot the economy. The problem is that the economic growth we’ve had over the past decade seems largely driven by consumer spending. The reason the economy didn’t drop into recession a few years ago is because people didn’t save — they spent money on all sorts of stuff. Greater savings would result in lower consumer sales which would translates into recession early.

The problems are two fold. First, a significant portion of that spending has gone to overseas manufacturers, rather than being fed back into manufacturers and labor in the US, to be then spent on more consumer goods in the US.

The second is that it seems we’ve built a giant Ponzi scheme to keep the economy going. We can stay out of recession as long as people keeping acquiring debt to drive the economy forward. Eventually, though, credit dries up, less money comes in from consumer spending and we end up in recession or worse.

Increasing savings is exactly what individuals should be doing. Unfortunately, if people do what they should, we are likely to have problems at the national level.

I don’t want to see a recession, but that may be what it takes to reboot the economy.

]]> By: FFB http://sensetosave.com/2008/02/22/lets-get-our-savings-rate-back-in-the-black/comment-page-1/#comment-5264 FFB Fri, 22 Feb 2008 14:06:48 +0000 http://sensetosave.com/2008/02/22/lets-get-our-savings-rate-back-in-the-black/#comment-5264 I'm taking an economics class now. One statistic I read says that US consumption (read spending) has grown rapidly since the 80's. And what are we spending on? Among other things, lots of foreign goods which also helps to lower the GDP. So what is out government doing about this? Giving us a stimulus check in the hopes that we go spend more! Interestingly, if the Fed raised rates it could give more incentive to save. I’m taking an economics class now. One statistic I read says that US consumption (read spending) has grown rapidly since the 80’s. And what are we spending on? Among other things, lots of foreign goods which also helps to lower the GDP. So what is out government doing about this? Giving us a stimulus check in the hopes that we go spend more! Interestingly, if the Fed raised rates it could give more incentive to save.

]]>