[/caption]Today, the Bureau of Economic Analysis reported that spending and savings grew in May.
It was only yesterday during the G20 Summit meeting in Toronto, Canada, the United States was being admonished on our prodigal spending by leaders from throughout the world.
The Bureau highlighted that income grew more than consumer expenditures; in essence, the American people have more income to spend, rather than relying on credit as they have been.
President Obama was asking his G20 counterparts to encourage their country's people to spend more, in an attempt to stimulate economic growth.
This May's results are showing just a start of what will hopefully be a recovery, and we are going to need a steady trend of this economic good news to have the confidence in our economic growth, which has been projected by President Obama.
Personal income grew by 0.4 and 0.5%, depicting a steady but modest growth for the last three months, and over the same quarterly period the disposable income grew 0.5%. This disposable income is the key, and is an important economic barometer, giving us clues as to the health of our economy.
The Bureau of Economic analysis report also showed that not only was the American public saving, but that they were spending too.
Americans saved an annual 6.3% in April, and while this might please the fiscal hawks, we must engage in spendin, according to President Obama and Secretary of the Treasury Timothy Geitner, in order to spur longtime and lasting growth.
The ratio of spending to saving was 4% in May… the highest since 2009, and no matter the overall positive impact on our economy, it has to start somewhere.
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