Tag Archives: economic history

The US Savings Rate Under Each President Since Ronald Reagan (Charts)


There has always been something of a fractured truth about the president’s role in the economy and wealth of the United States. Like a quarterback in the NFL, when things go right they get too much of the credit and when things go wrong they get too much of the blame. Because economic policies tend to lag most presidents spend their first term under the echoes of the previous president’s economic policies and not until their second term (if they get one) do you see potentially their own policies being felt. Never mind the impact that Congress also plays in setting economic rules and regulations, especially as it relates to the tax code. Lastly, the greatest wielder of any economy is the central bank or in this case the Federal Reserve. Unfortunately, we often force our perception to be reality.

In good times, Americans have notoriously under saved and conversely in bad times find it hard too save. Culturally, Americans have never been a country of savers. Some argue this has been a result more and more in recent generations of the societal safety nets in place that discourages savings behavior. There is some truth to this when you see countries in Asia where savings rates can be upwards of 30 percent arguably because there is no social security or government assistance of any sort if something were to happen. How a culture views debt and values possession can have an acute influence on households emphasis on savings.

So what exactly is the savings rate? Investopedia defines the savings rate as, “The amount of money, expressed as a percentage or ratio, that one deducts from his/her disposable personal income to set aside as a nest egg or for retirement. The cash accumulated is typically put into very low-risk investments (depending on various factors such as expected time until retirement), like a money market fund or a personal IRA comprised of non-aggressive mutual funds, stocks and bonds.” No president over the past 35 years has enjoyed a higher savings rate than Ronald Reagan at 12.7 percent and no president has enjoyed a lower savings rate than George W. Bush at 1.9 percent. Both, largely could be explained by the aforementioned Federal Reserve policy of interest rate movement. The Federal Reserve during Reagan’s tenure held interest rates in the healthy double digits, while the Federal Reserve during George W. Bush’s tenure in office were pushed toward near zero.

RONALD REAGAN (1/20/1981 – 1/20/1989)

Highest – 12.7% (November 1981)

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Lowest – 3.8% (April 1987)

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GEORGE H.W. BUSH (1/20/1989 – 1/20/1993)

Highest – 9.9% (December 1992)

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Lowest – 7.1% (August 1989) Screen Shot 2015-05-01 at 5.49.59 PM

BILL CLINTON (1/20/1993 – 1/20/2001)

Highest – 8.4% (December 1993)

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Lowest – 3.5% (December 2000)

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gEORGE w. BUSH (1/20/2001 – 1/20/2009)

Highest – 7.9% (May 2008)

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Lowest – 1.9% (July 2005)

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BARACK OBAMA (1/20/2009 – Present)

Highest – 10.5% (December 2012) Screen Shot 2015-05-01 at 5.53.38 PM

Lowest – 4.1% (December 2013)

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Source: St. Louis Fed

HBCU Money™ Dozen 3/24 – 3/28


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Did you miss HBCU Money™ Dozen via Twitter? No worry. We are now putting them on the site for you to visit at your leisure. We have made some changes here at HBCU Money™ Dozen. We are now solely focused on research and central bank articles from the previous week.

Research

How do the FBI and Secret Service know your network has been breached before you do? l NetworkWorld http://ow.ly/v6ecl

Effect of reduced feed intake on milk production in mares l KY Equine http://ow.ly/v6em3

Food & health educators, seafood professionals, & communicators: Workshop Apr 7-10 l Delaware Sea Grant http://darc.cms.udel.edu/sgseafood/

Genetic tree of bird life could solve the Noah’s Ark problem – which species to try to save l New Scientist http://ow.ly/v6fp3

Solar achieves price parity in Europe l Computerworld http://ow.ly/v6fA3

Inside the Shadowy World of Data Brokers l CIOonline http://trib.al/FYR1Ch4

Federal Reserve, Central Banks, & Financial Departments

A look at the recent economic histories of Japan, the U.S. & South Korea l St. Louis Fed http://bit.ly/1jYfgXe

Thoughts on Accommodative Monetary Policy, Inflation and Financial Instability l Chicago Fed http://ow.ly/v6gk6

Do property tax assessment caps have any effect on gentrification? l Atlanta Fed http://goo.gl/CQHU7A

Tackling air pollution would improve health and boost GDP l World Bank http://wrld.bg/v1aqe

Learn about data & market-based tools for neighborhood revitalization l Philly Fed Comm. Dev. http://ow.ly/v6gMw

High school teachers: Direct your students to the College 101 – College Planning l St. Louis Fed http://bit.ly/16NiVmp

Thank you as always for joining us on Saturday for HBCU Money™ Dozen. The 12 most important research and finance articles of the week.