For two years, we have been hearing about the negative savings rate in this country. Americans spend more than we make, so the chorus goes. The government reported that the personal savings rate turned negative in 2005 for the first time since the Great Depression. Things were worse in 2006.
It's not true. The Bureau of Economic Analysis recently revised the 2005 rate from negative 0.5% to positive 0.5% and the 2006 rate from negative 1.1% to positive 0.4%. The revisions did not get nearly the fanfare that the original reports of a negative savings rate garnered.