Where did all the money go ⬆️%

It occurs to me that as we face our collective and individual problems, we could discover the source of many problems by staring in a mirror. What we do, don’t do, believe or reject, the decisions we make are truly what matters.

Con­sumers built up un­prece­dented sav­ings buf­fers dur­ing the Covid-19 pan­demic, thanks to gov­ern­ment stim­u­lus and fewer op­por­tu­ni­ties to spend. The ex­tra cash helped house­holds pay down debt, buy goods like new ap­pli­ances and fur­ni­ture dur­ing lock­downs and take va­ca­tions once re­stric­tions lifted. It gave busi­nesses lee­way to raise prices and hire more work­ers to meet stronger de­mand.

Econ­o­mists es­ti­mate that headed into the third quar­ter of this year, house­holds still had about $1.2 tril­lion to $1.8 tril­lion in “ex­cess sav­ings”—the amount above what they would have saved had there been no pan­demic.

Wall Street Journal, As Savings Slowly Shrink, Consumer Spending Is on Borrowed Time, November 21, 2022

3 comments

  1. There is no zero-sum equation which can justify the spending of trillions of borrowed dollars. As interest rates rise with inflation, the price of the economic stimulus will cost the poor and working class greatly. A political solution to a fiscal problem is never in the best interest of our citizens.

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  2. I guess I would ask, what money? The stimulus payments were not significant enough to the wife and myself to have any real impact on our lives going forward. We did curtail spending during the 2 years of shutdowns. That created some savings but we increased making savings deposits to the grandkids and that’s about it. So I don’t sense any great change in our spending or lifestyle or any reason to look at myself in a mirror over it.
    The estimate of excess savings that some economists think we have may or may not be there.

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