Long Term Perspective
The debt-to-income ratio peaked in the fourth quarter of 2001, at the same time that the personal savings rate plunged in response to increase auto purchases. Otherwise, the general trend in savings is positive and the debt-to-income ratio has decreased slightly since its peak. In periods of economic uncertainty, or during recessions, consumers tend to add to savings and diminish debt burdens.

Short Term Perspective
The debt-to-income ratio rose in September as income growth moderated. Consumer credit has posted year-over-year gains between 3 and 4 percent for the past six months, the slowest pace since 1992 when the U.S. economy was coming out of the 1990-91 recession. The personal savings rate has remained in a tight range since March. The July and August uptick in the savings rate is due to the change in the personal income tax schedule during these months. The savings rate was back down in September.

Real GDP vs. Final Sales   •   Real Consumer Spending vs. Real Income   •   Debt Burden vs. Savings Rate

Business Fixed Investment vs. Net Cash Flow   •   New Orders   •   Housing Starts vs. Mortgage Rates

Merchandise Exports vs. Trade Weighted Dollar   •   Merchandise Imports vs. Trade Weighted Dollar