Why saving does not matter. (credit card, debt, borrowing, buy)
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If the only problem is we don't save enough then will someone please explain Japan. If all we need to do is return to personal fiscal responsibility then Japan must be an acute embarrassment since they are among the best savers in the world. I know the answer but I am interested in those that fall for the financial press canard that we just don't save enough. Why did the magic bullet fail?
Haggai 1
6 “ You have sown much, and bring in little;
You eat, but do not have enough;
You drink, but you are not filled with drink;
You clothe yourselves, but no one is warm;
And he who earns wages,
Earns wages to put into a bag with holes.”
As with all arts of swindle, the common sense approach fails utterly. Saving is futile when the swindler has given you a bag with holes.
That is two posts off subject. Its simple enough. Japan has a very high personal saving rate. Who among those who say we need to save more will explain Japan? Is anyone able to do it?
The problem is if we save, the money still gets taken from us. Here we had no savings, but even if we did, our country would still be in crisis like Japan went through with their 'Lost Decade.' Which is now becoming two lost decades.
But gwynedd1 even if we got rid of fractional reserve banking and go by your method, whoever controls the money still has the power, no?
That is two posts off subject. Its simple enough. Japan has a very high personal saving rate. Who among those who say we need to save more will explain Japan? Is anyone able to do it?
well, you might have to just spell it out for simpletons like us. What does Japans high personal savings rate have to do with the position they find themselves in (oh yeah, please tell us what position you are referring to)?
The problem is if we save, the money still gets taken from us. Here we had no savings, but even if we did, our country would still be in crisis like Japan went through with their 'Lost Decade.' Which is now becoming two lost decades.
But gwynedd1 even if we got rid of fractional reserve banking and go by your method, whoever controls the money still has the power, no?
Hi sheenie2000,
The only money system worth anything is eternal vigilance. To help this we need a money system most people understand. If money creation was the responsibility of the treasury and spent into circulation and then recovered as taxes most people would understand the system. The problem is most people cannot follow this shell game.
well, you might have to just spell it out for simpletons like us. What does Japans high personal savings rate have to do with the position they find themselves in (oh yeah, please tell us what position you are referring to)?
Hi broadbill,
The first reason is that while we went into debt to buy houses and SUVs the government of Japan spent the money for Japan by building roads to nowhere and government projects no one uses. This private debt of Japan is low while the public debt is high. So on that simple point personal saving is no defense. However it gets worse... far worse.
Does anyone have a comment on the following?
Why was it necessary for Japan to go into debt while the society was sitting around doing nothing in depression?
Why was the government thwarting Japanese personal saving?
Who does Japan owe?
The first reason is that while we went into debt to buy houses and SUVs the government of Japan spent the money for Japan by building roads to nowhere and government projects no one uses. This private debt of Japan is low while the public debt is high. So on that simple point personal saving is no defense. However it gets worse... far worse.
Does anyone have a comment on the following?
Why was it necessary for Japan to go into debt while the society was sitting around doing nothing in depression?
Why was the government thwarting Japanese personal saving?
Who does Japan owe?
OK....back to your original point though. Who ever said that Japan's high personal savings rate was going to save/defend them from their high public debt accumulated by Japan's government spending? If anything, Japan's high personal saving rate might exacerbate the situation as the Japanese were saving instead of spending which may have served to keep the economy afloat (to a certain extent...it didn't work here!)
More to the point though: Just because the high personal savings rate of the Japanese may not help their economy as a whole doesn't mean that its not smart for the average Japanese citizen (or a citizen of any country for the matter) to save their money.
But Japan does have to borrow from foreigners like we do and pay the interest to tehm. Also the individaul japanese wil be better off when the economy turns like it has now;juts as amerocains who saved are better offf than those that ar ebroke or in financial debt.Look at what negative savings( spending more than you make ) has done to many people when the economy first started going south. Ask anyoine who has alot of credit card debt what that does to your finances in a downturn. Remember that the money the governamnt is borrowing to help p[eople in the stimulus has to be apid back with interest and not much of that interest is going to US citizens in the future.
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What does Japans high personal savings rate have to do with the position they find themselves in (oh yeah, please tell us what position you are referring to)?
