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As a European, for me the most telling part of Bruce's analysis is
his reference to the efficiency with which America uses its capital.
Whatever the level of the savings rate, if a very high importance is
given to the security of savings, and a relatively low importance
attached to return, there is very little risk capital and little fuel for
new ventures.
Here in the United Kingdom, we have a high level of home ownership
and houses have traditionally been the preferred haven for investment.
If not houses, mutual funds are very popular. But there are very few
private investors interested in the stock market and even fewer looking
at providing capital for new ventures.
When I look across at America, you have a large number of people
prepared to invest in new ideas, many of which will fail but some of
which will be spectacular successes. Recently the overall rate of success
has been quite high, I imagine, though I have no figures. So the rate of
return on the money you as a country have saved is, I think, much higher
than in some European nations, and Japan.
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