Amid soaring credit card use, the tumble in Americans' savings rate continued in December with a modestly better than expected 0.4% MoM rise in incomes and as expected 0.4% rise in spending (but upward revisions in spending).
For the inflation waters, the Fed's favorite price indicator, the Core PCE, saw a one-tenth gain to 0.2%, matching consensus, and was up 1.5% Y/Y.
Income is growing at 4.1% YoY - the most since Nov 2015 - but spending continues to outpace that growth.
Income growth is dominated by private worker gains, which are rising at an impressive clip, up 5.2% YoY, the highest since Nov 2015.Meanwhile, government workers arent' doing too bad either, with average wages and salaries rising 3.1% Y/Y.
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They can't track the savings rate anymore. Nobody lets the bank have their cash for a .001 interest rate. All that money being kept in homes, under beds, in safes, and safe deposit boxes, buried in back yards, etc. is not being recorded by the government. Get interest rates back up, and money will flow back into bank accounts.
ReplyDeleteBingo 1153! Heck if I'm letting them use my money to make more money while only paying a fraction of interest to me. Want people to save money? Give them more of an incentive to let you hold it.
ReplyDeleteExactly! Need to stash cash in case they gov.freeze your accounts. Stupid millennials will be broke.
ReplyDelete