Thrift Today, Gone Tomorrow

The global recession that began in 2007 revived Americans’ interest in an old-fashioned virtue: thrift. And some say it will last — but history says otherwise.

Thanks to shriveling job and stock markets and plummeting real estate values, saving money have become all the rage, and Americans en masse are re-using their tin foil, cutting coupons and boasting about their thrift-store bargains. (Read 13 Thrift Store Shopping Tips.) Conspicuous consumption is out, conspicuous frugality is in. Economists and pundits have pronounced the arrival of a new era – the era of like-it-or-not thrift.

Over the last few months, we’ve seen signs that the economy is perking up. The housing market is leveling out, growth in parts of Asia and Europe has been surprisingly robust, and many forecasters expect the U.S. economy to grow in the second half of the year. (Though Some Smart People Say We’re Still Kinda Screwed.)

Even during periods when thrift was framed as a virtue, it turned out to be a virtue Americans couldn’t wait to relinquish.

But one important piece of the puzzle – consumer spending – has remained stubbornly low, and economists and policy makers worry that consumption won’t ever climb back to pre-recession peaks…