Monday, January 30, 2012

Saturday October 22. 70% of the U.S. economy, measured in GDP is consumer spending. It is said we are a consumer-driven economy.


Saturday October 22. 70% of the U.S. economy, measured in GDP is consumer spending. It is said we are a consumer-driven economy. The health of this economy depends on individuals’ ability to purchase homes, cars, appliances and vacations. When we are looking for a recovery from the current recession, we have to ask ourselves the health of the U.S. household.  So what are the household metrics?

Ask Dr. Econ

How has the percentage of consumer debt compared to household income changed over the last few decades? What is driving these changes? (July 2009)

Great question. It looks like you want to know how household debt has grown over time relative to disposable personal income.1 Or, even more to the point, whether our debts are increasing faster than our incomes. This is an important and timely question in the challenging economic environment of 2009, as the financial crisis and economic recession have affected both credit and incomes. Let’s see what I have for you!

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