Savings Rate

The Washington Post Accuses Stingy Americans Of Ruining Obama's Recovery

Dear broke American consumers which once made up the world's most vibrant middle class: please stop being such a nuisance and source of confusion to nice Op-Ed columnists at the WaPo, the WSJ and, of course, the Fed and their $4.5 trillion in direct injections into the offshore bank accounts of America's wealthiest 1%, and instead go ahead and splurge all your savings on trinkets, gadgets and gizmos you don't need. Only that way will Obama's recovery be truly complete.

According To Deutsche Bank, The "Worst Kind Of Recession" May Have Already Started

According to Deutsche Bank the worst kind of a recession, an "endogenous one" in which labor demand plunges as "corporations are not just tired of negative profit growth, but also because they are drawing a line in the sand from the perspective of defending margins" may be imminent... or is already here because based on "payroll reports like last week’s suggest it could be around here."

The Central Bank War On Savers - The Big Lie Beneath

The central bank war on savers is rooted in a monumental case of the Big Lie. Here is what a retired worker who managed to save $5,000 per year over a 40 year’s lifetime of toil and sweat in a steel factory now earns in daily interest on a bank CD. To wit, a single cup of cappuccino. Yet the central bankers claim they have absolutely nothing to do with this flaming economic injustice.

Savings Rate Highest Since December 2012 After Personal Spending Disappoints Again

Following the drastically revised-away surge in spending in January, and the savings rate surge to 2012 highs in Feb, March's income and spending data released today showed more problems for The Fed. While income grew 0.4% MoM (more than the 0.3% expectations), spending disappointed with a mere 0.1% rise (against +0.2% MoM expectations). Year-over-year spending growth slowed to 3.5% - the weakest since December and income growth slowed to 4.0% YoY leaving the savings rate at its highest since December 2012.

Fed Levitation & The Looming Liquidity Trap

Like the “little Dutch boy,” the Fed currently has a finger stuck in every hole of the dike. The only question is how long is it before the Federal Reserve runs out of “fingers” to plug the next leak?

One Third Of Q1 Economic Growth Was Just "Revised" Away

While the February personal consumption expenditures (aka personal spending) - that all important data about the well-being of the US consumer - was in line with expectations rising 0.1%, it was the January revision that was striking. From a 0.5% increase reported a month ago, it was now revised to a paltry 0.1%. In nominal dollar terms, this means that instead of US consumer spending a whopping $67.5 billion more in January, the increase was a paltry $14.7 billion, a delta of $52.8 billion!

January Spending Surge "Revised" Away, Pushing Savings Rate To Highest Since 2012; Personal Income Slides

Headline data for income modestly beat expectations (+0.2% MoM vs +0.1% MoM) and spending met expectations at +0.1% MoM respectively. Income growth YoY slowed to 4.0% however - near its weakest since Nov 2013. Spending growth also slowed to +3.8% YoY (from 2.9% in Jan) but the big story is the major downward revisions in spending. January's +0.5% 'surge' in spending was revised to a mere +0.1% trickle - the weakest in over a year.

Why Bond Traders Have No Idea What's Going On

"...markets have essentially lost confidence in the ability for central banks to stoke growth and inflation... we see very few reasons to be excited by today’s action or any development since the February 11th market lows."

Fear The Smell Of (Monetary) Napalm In The Morning

If central bankers think that "helicopter money" might be an option to combat deflationary pressures and sluggish economies, the right time to launch the choppers is before consumers realize they need them. As history shows, after that, it is too late.

Rate Hike Odds Rise As January Income, Spending Surge Most Since May

Amid the collapse of PMIs, regional Fed surveys, and surging inventories, personal income and spending both surged 0.5% MoM in January  - both better than expected. This is the best monthly gain since May 2015 as a drastically-revised data series notches the savings rate lower historically, but rose MoM. It seems Mester's comments this morning that a March hike is still on the table just got further support... time for another market crash to nsure that doesn't happen.

Even The Average Joe Gets It: "They’re Winding Us All Up For A Minsky Moment"

"... the average Joe isn’t as gullible as he once was and the personal savings rate remains high and is rising. Get out and buy something you don’t need, your kids can pay for their own education. If you really want to see people spend and invest there has to be some belief this won’t all end in tears."