Consumers: Income & savings up -- Gov't worried

Perhaps the gov't needs to realize that if they allowed people to bring home more from their paychecks via tax relief, then they will have enough to both save and extra to spend. Of course that would mean having to stop the spending gravy train.

Where does anyone find a savings rate of 6.9%?

Incomes were only up because they counted the stimulus checks and SS increases as income. The numbers were heavily scewed by the many people who do not even pay taxes that got money.

Real incomes are down.

Kstupp,

The savings rate refers to the percentage of money people are putting aside for a rainy day, on average, across the country. It has nothing to do with a dividend yield.

If you are looking for investments with high yields AT&T (T) and Verizon (VZ) pay over 6% currently and Kinder Morgan (KMP) and Boardwalk Partners (BWP) pay over 8%.

Iridium,

Always nice to see your comments. You are correct that the income figures are not definitive increases, however, the savings is...and it is higher than any meager amount of money anybody is getting from the government so it is a net positive and trending upward. Keep saving!

I don't believe it...virtually nobody I know is saving. They are mostly just barely paying their bills.

I wonder if the savings number is an abberation caused by people cashing in their retirement brokerage accounts because they don't trust them anymore, and temporarily putting them into savings until they figure out what to do next? A lot of people who have a relatively short window until retirement are cashing out now at what they perceive is the peak of this bear rally.

By the way, my favorite dividend paying stock is Duke Energy, which pays about 4% with as little risk as you can get these days. There is also a fairly good chance of upward movement in the stock price, since power costs are likely to go up indefinitely.

al,

You're up early, even on Saturday.

Not that I've studied the issue, but wouldn't the abberation you cite be too narrow to be reflected in the figures Sheldon cites? I mean how long ago were the savings figures tabulated versus how recently can we define the "peak of this bear market rally"?

But yes, I know many who are deferring major purchases usually to be better prepared if unemployment comes. Which may not be the right reason, but gets us to the right goal.

Duke Energy has been a staple for many years.

I've fallen into a rut....fall asleep by 9 or 9:30...wide awake at 3:00 AM. But it's not too bad. It gives me time to do my paperwork and catch up on the news.

I just have this feeling that people ( at least the ones I know) are not saving right now. The "Peter Lynch" in me tells me that there is something amiss with these savings numbers.

Remember, all Government numbers are suspect.

I don't fully trust stat's either, even those that look solid can be read in different lights. There is probably some truth in these as there is a fair degree of uncertainty about. The smart people know that having something in the "piggy bank" is a buffer against the unknown. As stated, I can see where this would cause the government some alarm as the economy has been at least 70% consumer spending driven for many years. I think that everyone should also be aware that this "consumer spending is also at least 70% purchase of foreign made goods and that my pen pal friends, equates to a slowing somewhere else.
At present things are somewhat stable but what our government refers to as "core inflation" is only months away - that is fact - not my imagination. It will be in the grocery store, and if oil keeps going, there too. The drought in the West and the acid rain in the South have already created much crop damage. Comes Oct. the ranchers will cull the herds greatly because it will cost too much to feed the cattle. Buy your beef in Nov. and Dec. for it will be thru the walls comes spring. So far this does not look pretty and could well be a major detriment to a recovery.