3. New American Savers?

Of course, when looked at from a bureaucrat's perch, the stimulus needs considerable stimulation. Right now, we're looking at a personal savings rate in this country approaching 5%; and, I think, it's well on its way to 10%.

But that's not the half of it. Literally. If it were, we would be so much better off; instead, that personal savings rate is only about the -35% of it.

The point of recognition will be about just this thing: We're saving like mad, even as our household debt load is roughly 130% of disposable income.

Bad news for balance-sheet repair. When your debt load is 100% of disposable income, you can at least hold your head above water. At 130%, you're basically saving up for default... So you can walk away from debt (and access to credit, which you were living on to meet monthly expenses) and still buy food and, hopefully, shelter.


4. Structural Shift Still Only Beginning

So this is what's meant by the phrase, "Just when we thought it was over, it was really only beginning." The structural shift in consumption is still very early in the forced thrift/denial stage, with minor trends in voluntary thrift just beginning to show up.

This isn't a prediction that all consumption will end. Rather, it's a major shift in the prioritization of consumption; a change toward productive consumption versus non-productive signifiers.

Consider the following trend just beginning to emerge among graduating college students:

Georgetown Classmates Ditch Wall Street Path for Salad Bars, Frozen Yogurt - Bloomberg

"When Nicolas Jammet and 2 of his Georgetown University friends decided to pass up careers on Wall Street to open a salad and frozen-yogurt restaurant in Washington, potential investors and landlords laughed at them." 

And then, this: "“If you do the entrepreneurship thing right away after college, you have nothing to lose,” he said. “The minute you enter that corporate world, you’re not leaving. The minute you get your 401(k) and health insurance, it’s over.”"

It's over. Think about what that means: "It's over." What is being referred to? On the most superficial level, the opportunity to exercise creativity. But there's also the connotation of being trapped in something false. The notion of having "nothing to lose" might seem, at first blush, an expression of increased risk appetites. But -- and somewhat ironically, given the high rate of failure for startup businesses -- it's almost nihilistic. Why voluntarily become trapped in the corporate world, only to lose everything anyway?