Friday, October 3, 2014

US Savings And Investment: 1969 - 2013 Chart

From Tax Foundation, "Losing the Future: The Decline of U.S. Saving and Investment" by Alan Cole:
As saving has declined in the U.S., though, so has investment.

US Savings And Investment: 1969 - 2013 Chart
Source: Tax Foundation

Figure 2 (above) includes all saving and investment in the U.S. as a percentage of GDP, including both the private and public sectors. Over the last four decades, saving and investment have continued on a downward trend, falling from over 10 percent of GDP to less than 4 percent today.

Saving and investment move in similar patterns overall. In general, saving is necessary to enable investment. But saving and investment are not exactly the same thing; in the U.S., investment outpaces saving. This discrepancy exists because the United States has an open economy. Foreign savers can purchase investments in our nation, and vice versa. Much of the investment in America is financed from abroad. Foreign savers, in other words, are stepping in with their savings to fund the investments that American savers cannot afford.[Footnotes omitted.]

No comments:

Post a Comment