UK "one of the wealthiest countries on the planet & getting wealthier by the day"

ILW

HAMISH_MCTAVISH wrote: »

And then promptly shot up to an equally unhealthy high of nearly 9%.



Savings ratios of between 2% and 5% are reasonable, allowing for decent savings AND economic growth.

That the savings ratio has reduced to within this range is a very good thing for the economy.

Would 2% remove reliance on the state for a pension or medium term unemployment?

HAMISH_MCTAVISH

ILW wrote: »

Would 2% remove reliance on the state for a pension or medium term unemployment?

Not over the long term.

I quoted a range, as the average fluctuates, but savings rates of 9% are madness, as we saw the havoc they played with the economy in recent times.

ILW

HAMISH_MCTAVISH wrote: »

Not over the long term.

I quoted a range, as the average fluctuates, but savings rates of 9% are madness, as we saw the havoc they played with the economy in recent times.

So at 2% we are just storing up bigger problems for the future?
I doubt 5% would cover most people with the population aging as it is.

Loughton_Monkey

Graham_Devon wrote: »

Indeed. I don't want to get in the way of yet another one of your rather obsessive posts about myself (every 3rd post of yours seems to be about me Loughton? But you hardly ever get a reply!), but you are so wrong on this one it needs highlighting...

Page 1....where all this stems from...

I'm glad you're counting. Your distinct lack of reply was worrying.....

[Weasel out of it like GD does mode]

I think what I said was:

Loughton_Monkey wrote: »

....I think most of us are talking about the proven tendency for spending to go up as house prices go up. A lot of it is the 'feel good' factor or confidence. Some of it, also, is the syndrome of "look... house prices going up... maybe we'd better upsize now." or "Let's get on the ladder before it goes out of our reach..."..

If Wotsthat is not included in my definition of "most of us" then that puts me in the clear.

If he 'comes clean' and confirms to all of us something like "I swear by almighty God that I, Wotsthat, am indeed a single person with my own views and in no way am 'most of us'" then I shall breathe a huge sigh of relief.

[/Weasel out of it like GD does mode]

I hate to say that Mrs LM has just announced that she's off to a home furnishing shop! Good news: I don't have to pretend to be doing something constructive for the next 2 hours. Bad news: She has the credit cards and will be spending some more of our wealth on a few depreciating assets.

HAMISH_MCTAVISH

ILW wrote: »

So at 2% we are just storing up bigger problems for the future?.

There has never been a long term state of 2%.

The longer term average looks more like 5%.

As I said, it fluctuates, and rightly so.

9% is terrible for the economy and society, 0% is equally bad.

Loughton_Monkey

HAMISH_MCTAVISH wrote: »

Not over the long term.

I quoted a range, as the average fluctuates, but savings rates of 9% are madness, as we saw the havoc they played with the economy in recent times.

I assume this savings ratio excludes money invested in pensions? I tried to find out on ONS website but couldn't find clarity. Most pension contributions are deducted from payslips and only the 'take home' would be considered as 'disposable'??

ILW

HAMISH_MCTAVISH wrote: »

There has never been a long term state of 2%.

The longer term average looks more like 5%.

As I said, it fluctuates, and rightly so.

9% is terrible for the economy and society, 0% is equally bad.

If that 5% is an average, it appears it is not high enough. All predictions seem to be that we are not saving enough to support our old age due to longer life spans and the associated costs.

HAMISH_MCTAVISH

ILW wrote: »

If that 5% is an average, it appears it is not high enough. All predictions seem to be that we are not saving enough to support our old age due to longer life spans and the associated costs.

We'll save a lot less if an excess rate of savings causes more of us to become unemployed and economic growth to slow or reverse.

That's the paradox of thrift in action.

More savings in the short term = less savings in the long term.

ILW

HAMISH_MCTAVISH wrote: »

We'll save a lot less if an excess rate of savings causes more of us to become unemployed and economic growth to slow or reverse.

That's the paradox of thrift in action.

More savings in the short term = less savings in the long term.

Is say 6% excessive?

CLAPTON

HAMISH_MCTAVISH wrote: »

We'll save a lot less if an excess rate of savings causes more of us to become unemployed and economic growth to slow or reverse.

That's the paradox of thrift in action.

More savings in the short term = less savings in the long term.

the paradox of thrift doesnt say that savings is a bad thing

rather it says that in an economy with highish unemployment then an increase in 'savings' will lead to further unemployment and actually a reduction is the total saved.

so we need to save in good times and spend in bad times

quite a revolutionary thought?