Banking and Finance

Saving for economic storms ahead makes perfect sense

People in Britain nowadays save more money and spend less, as the only solution to close the £379bn pensions gap is that everyone retiring from now on till 2051 should save an extra £10,300 every year.
Although Charles Bean, deputy governor of the Bank of England, advices us to get spending, and in that way help stuggling retailers, most people in Britain prefer to hoard some money to protect themselves against higher taxes and unemployment.
According to Urquhart Stewart, they will have to continue to spend but at a lower level than before, and especially concentrate on cutting their debts,which formed the main cause of the economic crisis, to prevent Britain from becoming a stagnant economy.
Due to the huge amount of support to the UK, not the deflation, but the hyperinflation might become the new biggest problem of the Bank of England,which includes that the savings of the British people would become worthless.


http://www.guardian.co.uk/money/2010/oct/06/saving-makes-sense


Iwein Porton