Full text: Capital Gains, Pension Funds and

6 
personal saving (Table 6).The discrepancy between gross and 
net saving rate did not increase any further since 1980 but 
if we add to the grosss saving ratios the correction of 
about 2 to 2.5 p.c.mentioned further above it appears that 
the dramatic decline of the saving rate becomes a rather 
less impressive experience.We may still ask ourselves 
whether the decline in net saving which still remains after 
the corrections is not due to an increased inclination of 
households to indebt themselves . To get a measure of 
households' indebtedness I have expressed the increment of 
liabilities in p.c. of the increment in assets of 
households as given by the flow of funds (Table 5).It is 
not very clear whether there is any long term trend. What 
the figures impress on us most definitely is the fact that 
indebtedness declines sharply in recession and increases in 
the boom:Thus from a low in 1981 and 1982 it rose to high 
levels in 1985 and 1986. The net saving therefore is high 
in the recession - the figures for 1974 and 1975 are not a 
good basis for comparison with the present - and it is low 
in the boom such as 1985 and 86. This cyclical pattern,due 
to the increased importance of consumer durables and debt 
which behave rather like business investment,has been 
stressed in -this, paper. 
If we add the gross saving rate (from table 6) to the 
borrowing of households (line 8 of table 5) to obtain the 
saving rate gross of new debt we find that this shows a 
pro-cyclical pattern. Should we add the 2 to 2.5 p.c. 
underestimate earlier mentioned to the figures for the 
latest years we would find no negative trend in this gross
	        

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