Is Saving Money a Luxury?

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It seems to me that when the savings rate was hovering around 0%, it wasn't because nobody was saving anything at all - rather, it was because a relatively small number of people had very large negative savings rates, because they were borrowing massive amounts of money against the phantom equity in their homes. They can't do that anymore - because the phantom equity has all disappeared - so the savings rate is now a better reflection of what everybody else has been saving all along. Could that be what's happening?

Johanna of MD 9:50AM May 21, 2009

The excuse about the "poor" not being able to save is simply asinine. Crack open a copy of Samuel Smiles "Thrift" and you will see examples of even impoverished people saving. Granted those examples are from over a hundred years ago but simply look at China for examples of the poor saving. My personal motto is, "If a way of life is lower then your standards.... then lower your standards." ;)

Michael Andrew Thompson of MI 8:50PM May 20, 2009