The nation’s savings rate fell to negative 1% in 2006, the lowest since the negative 1.5% in 1933, in the middle of the Great Depression, the Associated Press reports.
The personal savings rate has been negative for only four years: 2006, 2005, 1933 and 1932.
Economists surmise that the current decrease in savings is due to people who earned large sums on investments who are now dipping into those funds. Also, many members of the middle class may be using their savings to support lifestyles that their wages cannot due to raises not keeping up with inflation.
