China s national saving rate including household saving and business saving is now about 45 of its GDP, which is the highest rate in the world.

Saving. A domestic saving rate in excess of 50 has served China well.

America s Saving Rate and the Dollar s Future

The net saving rate fell to near zero.

Engrained habits probably exlain more about China s saving rate.

Instead, it reflected a fall in the personal saving rate.

The high saving rate of Chinese households reflects both the normal high rate of saving among younger generations and the fact that older generations had very little income and therefore did very little saving when they were young.

The United States has no compulsory saving plan, and it has an abysmally low in fact, negative personal saving rate.

The nation s net household saving rate is the difference between the saving of the savers and the dissaving of the dissavers.

The saving rate in China is the highest of any major country.

In the early 1980 s, China s saving rate was twice as high.

But, with the current low rate of household saving, the cycle of rising deficits and debt will soon make national saving negative.

No leading country in world history has persistently maintained a negative saving rate.

There is no way to predict what the saving rate will do next.

That would leave a net national saving rate of just 2.5 of GDP.

Fears of future wealth taxes could discourage entrepreneurship and lower the saving rate.

However, aging will keep the saving rate from falling at the same pace.

And with that lower saving rate will come a smaller current account surplus.

The drop in the saving rate can be readily traced to a massive increase in the rate of household consumption.

The aggregate saving rate of the household sector reflects the difference between the saving of the savers and the dissaving of the dissavers.

China s gross saving rate (the percentage of GDP that is not consumed immediately), which includes both public and private saving, is around 50 .

The United States has no compulsory saving plan, and it has an abysmally low in fact, negative personal saving rate. But the government is loath to consider a mandatory saving plan.

Since the saving of younger savers is now high and the dissaving of the older dissavers is low, the net saving rate is high.

The saving rate in each of those 25 years was between 7 and 11 .

Japan was long famous for having the highest saving rate among the industrial countries.

The household saving rate has collapsed in recent years, falling to less than 2 .

A variety of forces have contributed to a continuing decline in Japan s household saving rate.

CAMBRIDGE The household saving rate in the United States has tripled in the past three years.

But then the saving rate fell by a full percentage point, reaching 5.3 in December 2010.

The strength of the Indian economy is underpinned by a high saving rate and robust investment.

But when a country s growth rate continues to increase, its saving rate would increase faster than its investment rate, so it is more likely to run a current account surplus.

While a 6.9 saving rate is not high in comparison to that of many other countries, it is a dramatic shift from the household saving rate of less than 1 that the United States experienced in 2005, 2006, and 2007.

CAMBRIDGE The household saving rate in the United States has tripled in the past three years. Why?

If the saving rate continues to rise rapidly, it could push America s fragile economy into another downturn.

Although the saving rate came down gradually in the 1980 s, it was still 10 in 1990.

Japan s ability to sustain high fiscal deficits, low interest rates, and net capital exports has been possible because of its high private saving rate, which has kept national saving positive.

In any year, some households are savers and others, especially retirees, are dissavers that use past saving to finance current consumption. The nation s net household saving rate is the difference between the saving of the savers and the dissaving of the dissavers.

Looking ahead, the saving rate may rise even further, and will, in any case, remain high for many years.

The recent rise in the US household saving rate reversed a long term decline that began 25 years ago.

There is also a related risk that private accounts would cause a further drop in the personal saving rate.

The saving rate is the lifeblood of any economy, because foreigners cannot be expected to finance capital investment forever.

With a savings rate of barely 4 of GDP, the average US household is unlikely to be over saving.

The most important task for China is to reduce the saving rate, which equaled 52 of GDP in 2009.

When all of these reforms are realized, China s national saving rate may be reduced to 45 , from 51 currently.

The US should cut its budget deficit, increase its saving rate, and generally get its own house in order.