Consumers Are Both Confident & Broke – Last Time This Happened…

by John Rubino via DollarCollapse.com,

Elliott Wave International recently put together a chart (click here [..] to watch the accompanying video) that illustrates a recurring theme of financial bubbles: When good times have gone on for a sufficiently long time, people forget that it can be any other way and start behaving as if they’re bulletproof. They stop saving, for instance, because they’ll always have their job and their stocks will always go up.

Then comes the inevitable bust.

On the following chart, this delusion and its aftermath are represented by the gap between consumer confidence (our sense of how good the next year is likely to be) and the saving rate (the portion of each paycheck we keep for a rainy day). The bigger the gap the less realistic we are and the more likely to pay dearly for our hubris.

Where are we today? Worse than in 2006 and nearly as bad as 1999. Both of those years were followed by several really bad ones.

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TLB published this article, with our thanks for making it available, from Dollar Collapse.com

Other articles about the Economy from The Liberty Beacon:

TLBTV: The American Vision – Jump Starting the Economy

UBS Has Some Very Bad News For The Global Economy

Nobel Prize Winning Economist Blasts America’s ‘Rent-Seeking’ Economy

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