The magic decline of US personal saving rate happened when the long term real interest rate went down, US dollar was relatively high, US had a low level of unemployment rate and economic fluctuation, the net household wealth boomed, financial market was improved with many innovations. This paper establishes models to tell the relationship between these characters and the decline of US personal saving rate and analyzes the effect the globalization put on the decline of the long term real interest rate and the boom in capital market. It points out that globalization affected the US personal saving rate through the channels of real exchange rate, real interest rate and capital prices. In the end, it uses an econometrics model to prove its debate. |