You tell me, via Domainfax:
Capital Economics chief economist Paul Dales explains, the savings rate tends to be affected by movements in household wealth. The chart shows that as wealth rises, we tend to save less – known as the “wealth effect.”
“When household wealth is going up because the housing market is improving, the value of their assets is going up in the process, and people think, ‘I don’t need to save as much in cash because my house is doing it for me’,” Dales says.
