Monday, May 3, 2021

Personal saving surges to over $6T once again. Guess we all stopped going to restaurants?

 Here we go again. Personal saving surged to $6.04 trillion in March. I'm just waiting now for Neel Kashkari to come out and explain that it's because we didn't go to movie theaters and restaurants. (Hey, Neel, restaurants are open and people are spending again. Check retail sales.)

Actually, Neel's an idiot. (Seems to be a requirement to work at the Fed.) The reason for the surge in personal savings was due to those stimulus checks and other fiscal support. It works.

By the way, one byproduct of this has been a precipitous slowdown in the growth of bank loans. Not surprising. When the government supplies cash to people their need for bank credit goes down. Poor banks. Fewer customers begging for their credit. That means less fees and interest payments.

8 comments:

Peter Pan said...

Some restaurants were closed in March, because... pandemic.

mike norman said...

Some. But MANY more were open as compared to April 2020.

adamarice said...

Any idea how the $6T personal savings is distributed?

Matt Franko said...

Now “the deficit!” will increase commensurate and the idiots still won’t be able to put it together...

Peter Pan said...

Does personal savings include personal debt, such as student debt?

Matt Franko said...

https://www.bea.gov/data/income-saving/personal-saving-rate

Peter Pan said...

The U.S. personal saving rate is personal saving as a percentage of disposable personal income. In other words, it's the percentage of people's incomes left after they pay taxes and spend money.

So debts have to be deducted from this figure?
Spending money may include paying down personal debt.

Matt Franko said...

To get “net worth” maybe...

= Assets - Liabilities

Savings is on Asset side...

So if you have 100k savings and owe 50k student loan your worth is 50k ...