Hi HODLers, Hiveans and Investors,
I wanted to show you guys the current most important economic data as it will impact the growth of the economy and risk-on assets.
Personal Saving (long time period)
Personal Saving (last 12Y)
As you can see on the 2nd chart we are almost below the long term moving average. These personal savings are in nominal $bn and therefore do not account for imflation!
So the current $1tn in Personal Saving is much less that $1bn back in 2012.
Personal Saving Rate
Definition
Personal saving as a percentage of disposable personal income (DPI), frequently referred to as "the personal saving rate," is calculated as the ratio of personal saving to DPI.
Personal saving is equal to personal income less personal outlays and personal taxes; it may generally be viewed as the portion of personal income that is used either to provide funds to capital markets or to invest in real assets such as residences.
Source: (https://www.bea.gov/national/pdf/all-chapters.pdf)
So Personal Saving Rate is the basis needed to invest in real estate, stocks and guess what.... cryptocurrencies! We saw a boom in the CryptoMarket when governments decided to hand out stimulus checks, coincidence? Not really...
My opinion
Both are indicated trouble ahead, especially if you also look at other data points such as CPI at all time high or Credit Card debt and Mortgage delinquency at very high levels and increasing.
To sum it up: Americans are still spending as if they had money, but they don't! Once they realize it (credit card maxed out, bank taking ownership of their leased car, etc...), they will have to stop spending and this is when the recession kicks in!
Even if the nice bounce we just had in the Stocks and Crypto Markets make us all very happy and optimistic, beware because data does not indicate that we are out of the woods yet...
This is Non Financial Advice (NFA) of course.
What is your take on the Crypto/Stocks Markets for the next 2-3 months?
In the meantime, stay safe out there!
Source: https://fred.stlouisfed.org/