The Australian: No stopping US consumers as US household debt reaches $US11.4 billion, while EuroZone consumers save 14% of disposable income

The Australian

No stopping US consumers as US household debt reaches $US11.4 billion, while EuroZone consumers save 14% of disposable income

The net wealth of Americans, even after taking into account the large rise in debt, has risen by around $US5000 billion over the past year to $US51,000 billion. They are around $US8400 billion better off than they were five years ago. "If American consumers were grouped together as a company, they would have had a very weak profit and loss account in 2005 but the balance sheet still looks in splendid shape," said Eric Britton, an analyst at Oxford Economics.

In Europe however, the eurozone propensity to save is unlikely to drop much. Consumers have saved in excess of 14 per cent of their gross disposable incomes in recent years, compared with about 1 per cent in the US. Recent European Commission research concluded that the apparent implication of demographic trends is that the euro area should now be entering a golden age of saving as the post-war baby-boomers move through middle age. German banks generally only issue so-called credit cards on the assumption that sums outstanding will be paid off each month.