ABSTRACT
In mid-2008, shortly before the collapse of Lehman Brothers, the savings ratio of the UK household sector reached an unprecedented low point. It had been falling more or less continually since the early 1990s, as the level of personal debt rose alarmingly. By the rst quarter of 2008, household debt had almost surpassed the GDP of the entire nation and consumption exceeded real disposable income by almost 7 per cent.2
