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« Car Sales Poised to Plunge? | Main | More on Mortgage Backed Securities »

May 06, 2007


Shane Milburn

Bill, thanks for posting this. I love "bogusosities" by the way. I've always assumed something was broken behind the scenes but didn't know what. Why keep reporting it though if it's so completely mangled?

Bill Conerly

The official savings rate is not easily fixed. Part of the problem is caused by accountants saying that the employer's contribution to your retirement account is income at the time the contribution is made. That means the same money cannot be counted when it's paid out to you in a pension.

If I were data czar, I'd keep reporting the savings rate, but perhaps as an index number. The official rate does not tell us how much of our income we're saving. But changes in the savings rate over time do reflect a rough estimate of changes in saving over time.

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