Friday, October 28, 2011
Eurostat just released savings rate data for Q2 of 2011. The graph is above since 2000. It looks like savings rates have started to increase a little again - this would be consistent with the slowdown in Eurepean retail sales that began late last year, and presumably reflects European households feeling more cautious about the economic situation (but not catastrophically so at this point).
The latest agreement seems like it has successfully kicked the can down the road again, while failing to really solve the problem:
However, this non-solution is closer what is required than the last non-solution. No doubt we'll be back watching the same kind of spectacle again in a month or two. I guess when political and economic realities collide in this way, it may only be through a series of crises that the two can be reconciled. It's nerve-wracking to have the global financial system constantly at risk of collapse if politicians make a mis-step, but I guess we will have to get used to it.