Household debt to disposal income in the U.S

[ShcShc11 0]

We keep talking about the economy yet its rare to find people mention about the U.S household debt to disposal income.

http://www.ritholtz.com/blog/wp-content/uploads/2009/12/Household-Debt-to-Disposable-Personal-Income-Ratio.png

THIS is what makes the U.S economy sluggish.

Not some U.S Gov Debt.
Not about the tax.
Not about bs ''confidence fairy policies''.


Household debt IS the center of our economic problems.
THAT is what Sweden struggled with with their recession caused by financial collapse.
THAT is also what Japan suffered in the 1990s and had hard time ''fixing''.

Fix household debt, the spending level is normalized, the businesses invest in order to meet this demand and jobs come back.

The problem?
You have to punish the creditors and/or people who are saving money.

And unfortunately, its bad politics to say: ''we are punishing the ones who have been morally responsible with money'' ... or ''we are aiming 4% inflation''. Nobody wants to lose their money through inflation (neither do I).

But these are the real medicine when it comes to financial institution + housing recessions.

...
Much of the talk about economics in politics are just fluff.



Cheers!
Shc

[Andy9o8 2]

My disposal has only 1 kind of income: scraps of food. Oh, and the occasional spoon.

[kelpdiver 2]

Quote

We keep talking about the economy yet its rare to find people mention about the U.S household debt to disposal income.

Any idea what either of those terms is defined as?

Disposable income is net after taxes, rent/mortgage/utilities?

Debt is minimum debt servicing costs?