Junk Finance
Don't get cocky. This week's news that your cellphone won't give you brain cancer isn't cause for relief or rejoice. You see, it's really 1933 all over again:
"Americans' personal savings rate dipped into negative territory in something that hasn't happened since the Great Depression. Consumers depleted their savings to finance the purchases of cars and other big-ticket items."
Although the definition of "deplete" is "to use up" or "to empty out," it's hard to see how consumers have "depleted" their savings when U.S. households have a record $51 trillion in net worth and a near record $27 trillion in financial net worth (excluding homes).
By all means, let's employ policies that encourage more savings and investment, but let's not scare with the financial equivalent of junk science.
-Bret Swanson
