China’s Savings Rate vs. USA’s Savings Rate..are we (USA) doomed? March 9, 2006
From a CNN Money article:
Last year China saved about half of its gross domestic product, or some $1.1 trillion. At the same time, the U.S. saved only 13% of its national income, or $1.6 trillion. That’s right, the U.S., whose economy is six times the size of China’s, can’t manage to save twice as much money.
And that’s just looking at national averages that include saving by consumers, businesses, and governments. The contrast is even starker at the household level — a personal saving rate in China of about 30% of household income, compared with a U.S. rate that dipped into negative territory last year (–0.4% of after-tax household income).
Savvy Saver had an entry about some bloggers who say that we may be saving too much. Within the personal finance community, that may be true to an extent, but America as a whole is not saving enough for retirement. If we continue to use our homes as a source of spending money, we’re doomed.
Source:
The U.S. and China’s savings problem
By Stephen Roach
March 8, 2006
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[…] While we’re on the topic of China and how their personal savings rate is 30%, (vs. -0.4% in USA), let’s take a look at their taxation laws. […]