This headline says it all. When the going gets tough, the tough hoard cash!
While I’m sure some of this is US federal government stimulus checks, I suspect a lot of it came from stock sales and reduced personal spending.
Heck, if you’re living under quarantine – pardon me, ‘shelter-in-place’ – then there are fewer opportunities to spend.
No eating out at restaurants, lower automotive expenses if you’re working from home and fewer clothing expenses since we’re all wearing our jammies.
We saw a similar escalation in the savings rate during the Global Financial Crisis, so this behavior isn’t surprising. What is surprising is the absolute magnitude of the savings increase.
One wonders how much of that extra $2T will eventually move from the sidelines back into the stock market…