As housing values increase, Americans tend to save less. This is evidenced by the sharp drop in personal savings rates [RisMedia]. Now the personal savings rate is negative. [Reuters] In other words, we are spending more than we make.

“Many older workers, rather than building ‘nest eggs’ and paying down debt, are saving little and taking on adjustable-rate debt programmed to rise with interest rates, Kevin Lansing, senior economist at the San Francisco Fed, said in an economic letter.”

One Response to “Higher Home Values Mean Less In The Bank”

  1. pcampbell says:

    It doesn’t help that Congress enacted bills +- 10 years ago allowing corporations to claim bancruptcy and reneg on their pension plans ( which employees contributed to ) even though the corporation still had assets which they now used to sell to takeover corporations who then often used the assets to rebuid the company under an other name.