Features

Chart of the week: US consumers splash less cash

US consumers have finally stopped shopping and paid some debt back after decades of borrowing and spending.

975_COTW

American households were traumatised by the Great Recession, which was the worst for 70 years, says Fortune's Geoff Colvin. They finally stopped shopping and paid some debt back after decades of borrowing and spending.

The absolute level of consumer debt fell from the 2008 peak of $12.3trn and has ticked up gently since around 2013 to a new high of almost $14trn. But the days of "debt-crazed" shopping are over. In terms of GDP, debt has kept sliding from a pre-crisis 99% to around 76% as overall growth has eclipsed the pace of household borrowing increases. And households now save a "prudent" 8.1% of their income. The personal savings rate plummeted to zero in 2006 and 2007.

Viewpoint

Jim Rickard, Hard Assets Alliance

Recommended

How long can the good times roll?
Economy

How long can the good times roll?

Despite all the doom and gloom that has dominated our headlines for most of 2019, Britain and most of the rest of the developing world is currently en…
19 Dec 2019
Why Wall Street has got the US economy wrong again
Economy

Why Wall Street has got the US economy wrong again

The hiring slowdown does not signal recession for the US economy. Growth is just moving down a gear, says Brian Pellegrini.
25 Oct 2019
Inflation spiked in the US last month – is this the shape of things to come?
US Economy

Inflation spiked in the US last month – is this the shape of things to come?

Prices in the US rose much more dramatically than expected in July. Can we expect more of the same, and what does that mean for your money? John Stepe…
14 Aug 2020
If companies have too much power, we need more competition, not higher taxes
US Economy

If companies have too much power, we need more competition, not higher taxes

Free-market capitalism is breaking down and that is going to lead to higher taxes down the line. John Stepek explains why that matters for investors.
11 Aug 2020

Most Popular

No, the UK did not “plunge” into recession yesterday
UK Economy

No, the UK did not “plunge” into recession yesterday

That the economy took a massive hit due to Covid-19 should be news to no one, says John Stepek. The real question is what happens now.
13 Aug 2020
Inflation spiked in the US last month – is this the shape of things to come?
US Economy

Inflation spiked in the US last month – is this the shape of things to come?

Prices in the US rose much more dramatically than expected in July. Can we expect more of the same, and what does that mean for your money? John Stepe…
14 Aug 2020
The MoneyWeek Podcast: house prices, staycations, and the death of cash
House prices

The MoneyWeek Podcast: house prices, staycations, and the death of cash

John and Merryn talk about the rise in UK house prices and the fact that everybody is holidaying in the UK, plus gold's new highs, the death of cash, …
12 Aug 2020