Sickly Savings

The personal savings rate fell to just 3.1% in September, its lowest level since 12/07, the start of the Great Recession. The decline is undoubtedly being caused by record gains in household net worth. As a percent of disposable income, it’s 670%, well above the Housing Boom high of 650%. Ever higher bond, equity, housing, and real estate prices are feeding wealth. Should they weaken, growth will, at best, stall.