Booms, Busts, and Recoveries Message Board

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Strategies & Market Trends : Booms, Busts, and Recoveries

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To: Elroy Jetson who wrote (55275)	11/1/2004 3:26:52 AM
From: energyplay	Read Replies (1) of 74559

Hi Elroy - A little nuance to the data - Personal income does not count capital gains - not stock , bond, real estate, collectibles, etc. bea.gov Stock sales for "insiders" 29 billion in 2003, and 49 billion in 2004. Most employees don't count as insiders. sfgate.com Net market gains for individuals were probably >>10 times insider sales. Dividends to individuals were about 376-410 Billion per year. In the past few years, capital gains have far exceeded dividends.... Total net "saving" is about 100 Billion a year. If capital gains run about 500 billion a year....then the saving rate is closer to 5%.... Many people own real estate, and gains on real estate just don't show up here in personal income. I would easily expect this to be at least 1/3 what individual dividends are. that would double the savings rate. Basic problem : Subtract one BIG number (spending) from another BIG number (income) to get a small number (savings). Any erorrs in the income number really affect the small number. There's other stuff that's missed also. WHo is borrowing money for big houses, buying sports cars, etc. ? People on the East and West coasts - they same areas with lots of stock options, day traders, high real estate prices. I wouldn't buy options on the sky falling for a while...

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