Reasons to worry

Historian Niall Ferguson on the U.S. Economy in New York Times

Not only do Americans borrow as never before; they also save remarkably little. The impressive resilience of American consumer spending in the past 15 years has been based partly on a collapse in the personal savings rate from around 7.5 percent of income to below zero. The aggregate national savings rate, which includes the public sector and corporations, averaged 13 percent in the 1960's. Last year it was just 0.8 percent . . .

. . . The average American has an income of about $40,000 a year and has, as we have seen, a personal savings rate of zero. The average Chinese earns around $1,500 per year but has personal savings of 23 percent of his income — and is lending a large chunk of these savings, via the People's Bank of China, to the average American.