If you've taken in the recent reports on economics of the USofA, you might be wondering what the pundit class, and econ class, have to say about it. They have much to say, of course. What none of them that I've seen has said squat about the elephant still sitting in the room: Covid savings.
Here's a survey of some pundits. You can guess which scenario fits my brain.
One of the more pessimistic takes out there, from researchers at the Federal Reserve Bank of San Francisco, takes this approach. They calculate that excess savings peaked at about $2.1 trillion in August 2021, but by the second quarter of this year less than $190 billion remained, putting them on pace to be depleted in the current quarter.
If that were true, it would be hard to explain the latest growth figures. Well, unless they're just Fake News ginned up by the Fed (no cabal of Left Wing progressives, ya know). Where'd the
Bongo Bucks come from? No explanation yet offered that I've seen.
Goldman Sachs, for example, calculates that as of July there were $1.3 trillion in excess savings, an amount equal to about 5% of gross domestic product.
Now
that is something to behold. And would go a good way to explaining how the USofA economy keeps chugging along. The worry for Sleepy Joe and his acolytes: will the Good Times Roll until next election? Or will they disappear just before said election, a la Dubya? Only the Shadow knows.
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