Unemployment is reported at over 24%.

This are was the center of the distribution industry based on imports coming through the LA/Long Beach port, so the numbers could be that bad.

As pointed out by Michael Hudson, most of this "savings" is not money stashed away to prepare for retirement or serve as a safety net for future expenses but rather money paid out to service debt. This money does not of course constitute the pool for future business investment as normally referenced in texbook economics; it goes right back to our benevolent financial sector. Once again the NYT doesn't really get into this implication.

To Dennis Kneale: You're An Idiot

[...]

The consumer is 70% of our economy, give or take a few points. The consumer's "savings rate" (which government blithely declares as income minus spending), which was in fact negative (that is, consumers were spending more than they made through taking on more and more debt), but is now solidly positive at 6.9%.

The impact of this (6.9% X 70%) is an immediate 4.83 decrease in real GDP. Fudge the numbers all you want (and government will), but this is the math, and the math is never, ever wrong.

The truly bad news however is that most of the time saving in fact turns into capital formation - that is, it becomes investment. But government doesn't differentiate between actual savings and debt repayment - their formula is simply "income less spending = savings rate."

You had one guest on this evening who "got it", but you wouldn't let him explain it, so I will.

Consumers are not saving, they are paying down debt in a furious attempt to avoid defaulting on nearly $1 trillion in outstanding credit card balances that have gone from 11% interest to 29.6% along with OptionARMs that are experiencing a tripling of payments while the home's value is underwater and precludes refinance, all while consumers are being laid off by the hundreds of thousands monthly.

... I feel from it. I should probably be thankful for this but I find it slightly unsettling. It is like constantly seeing terrible thunder storm clouds in the distance and hearing all these stories about people being affected by it but then in my immediate circle of family friends and neighbors there is really nothing happening. Here in this part of the GTA even the real estate prices bounced back from there minor pull-back.

Obviously the reality of a lot of people looks different. Like SP I believe there is another shoe to drop so it is probably all the better that I still have to feel any effect. So far the idea to sit this out in Canada seems to work astoundingly well although I know that Ontario's economy is suffering - but again I am insulated from people affected by it. Maybe I should volunteer for the local food bank to get a reality check.

... this economic injustice in the US. Very much agree with Barbara Ehrenreich on this.

here.

I did inhale.

is a complete and utter FAILURE!! No question about that! Here is an excellent explanation posted by Ilargi at "The Automatic Earth"....

"The main reason why none of it has worked so far, and none of it will, lies in the political power of vested interests, banks politicians, industries, you name it. Nobody lobbies for a bunch of poor young kids, no matter how bright they are. And without lobbying, nothing will get done. You would need to break that vested interest power, and that can't be done through the present political system, because the politicians that voters have to choose from are part of that power.

It’s like racing towards a really steep cliff in a vehicle with no breaks, no reverse and no steering wheel. It's all you can do is to get out of the vehicle, to jump out while it's moving at mile-high speed and risk whatever it is that will come after. Or you can choose to believe those nice smiling folks on TV in their expensive suits who every day seek to assure you that there is no cliff, or it ain't all that steep, or that they'll find the steering wheel any day now. And every day brings more tidings that contradict their hopeful promises."