Americans have spent their savings. Economists worry about what comes next
CNN
Americans saved quite a bit of money during the Covid-19 pandemic, about $2.1 trillion, to be exact.
A version of this story first appeared in CNN Business’ Before the Bell newsletter. Not a subscriber? You can sign up right here. You can listen to an audio version of the newsletter by clicking the same link. Americans saved quite a bit of money during the pandemic: $2.1 trillion worth, to be exact. That extra cushion meant that consumers kept spending in the years that followed and the economy remained robust despite rising interest rates and persistent, though gradually decreasing, inflation. But now that extra spending money is gone, economists are concerned about what comes next. What’s happening: The most recent estimates of excess pandemic savings in the US economy have turned negative, according to Hamza Abdelrahman and Luiz Edgard Oliveira, economists at the San Francisco Federal Reserve. That means many Americans have more debt than savings and suggests “that American households fully spent their pandemic-era savings as of March 2024,” they wrote in a recent report.
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