Monday, June 19, 2017

How our Savings Rate affects economic growth and retailers

From the early 80's the savings rate in this country was around 12 percent. That meant people were spending 88 percent of their after tax income. The savings rate got down to 2 percent meaning people were spending 98 percent of their after tax income. 

The savings rate is now back around 5 percent and I think it could go to double digit numbers. So it does mean in terms of the economic growth you are getting reversal. Its an on-going feature, an longer term issue.