Saving/Investing

[krinkle]

in a recent presidential debate kerry stated that most chinese people invest (i think this is correct) 45% of the money they make while here in the usa it is more like 10 or 5 %

i thought this was pretty interesting-what do the chinese do/or not do to be able to accomplish this? and/or is this a true statement?

thanks

k

[wushijiao]

Yeah, Chinese people save about 40% of their money, while in the US, in the late 90's, it was something like negative 1%. Part of this, I think, has to do with perceptions of fututre job prospects and security. Also, if you or a family member gets sick in China, you pay out of pocket, so it's wise to save money.

I don't think you can use the word "invest", because generally this money is just held in banks. I think (correct me if wrong) that most investing in China is in real estate and businesses, while stocks and mutual funds are still much more risky, for transperency reasons.

Anyway, the Chinese government has tried to lower this high savings rate in recent years to make a bigger domestic market, and that seems to be working pretty well.

[krinkle]

Yeah, Chinese people save about 40% of their money, while in the US, in the late 90's, it was something like negative 1%. Part of this, I think, has to do with perceptions of fututre job prospects and security. Also, if you or a family member gets sick in China, you pay out of pocket, so it's wise to save money.

I don't think you can use the word "invest", because generally this money is just held in banks.

thanks for the reply and yes i remember reading somewhere that chinese saved more than americans too-it was kerry who used the word "invest" in the debate.

krinkle