Page last updated at 11:08 GMT, Saturday, 4 October 2008 12:08 UK

French save money for a rainy day

Woman having an eye test (file photo)
A visit to the opticians led to a discussion of the financial crisis

Emma Jane Kirby looks at how, unlike Britain and the US, the thrifty French appear to be weathering the credit crunch.

"I cannot believe," said Monsieur Arnaud as he firmly pushed my chin into the plastic support, "just how short sighted the British and Americans are."

He adjusted his ophthalmologist's chair impatiently and stared into my eyeballs.

"Blind bloody ignorance," he muttered as he jotted down some information about the state of my corneas. "Now what's the lowest line you can read clearly?"

It is never a good idea to start defending yourself and your country when your head is strapped into a strange medical contraption and a man you hardly know is staring into your pupils and poking his fingers under your eyelids. So I decided there and then not to take offence.

Naturally cautious

Concerned about my sight after a recent accident, I was only half concentrating on Mr Arnaud's conversation and was just vaguely perturbed that he seemed so resentful about the thousands of myopic Brits like me, who rely on contact lenses or glasses to get them safely from one side of the street to the other.

And then as he shone his pen torch into my irises, I quite suddenly saw the light. Mr Arnaud's problem, like that of so many other French people I have talked to over the past two weeks, was to do with how the British and indeed the Americans have shut their eyes to the fact that, when you live on credit, a crunch is inevitable.

Galeries Lafayette department store in Paris
It is much harder for French people to splash out on a shopping spree

"Buy now, pay later" may be a favourite Anglo-Saxon maxim but it is not one that translates easily into French.

Naturally cautious and prudent, the Gallic people tend to spend only what they earn. Household debt here is less than half of what it is in Britain, and the French are among the EU's biggest savers.

Although consumer temptation is just as strong here as it is in London or Washington, it is much harder for the French to splash out on a shopping spree.

Credit cards are more like debit cards. If the money is not already sitting in your account, forget trying to stick a couple of designer coats or handbags on your plastic because your bank will simply block the transaction.

Tightening belts

But the French have been nervous about money since long before the recent crisis. Over the past 18 months, it has been impossible to switch on the radio or TV here without hearing the words "pouvoir d'achat" or purchasing power.

Low wages and the global rise in food and fuel prices have meant people are having to tighten their belts. In the first three months of this year 3,000 restaurants and cafes went bust here because the euro-pinching French are staying in to eat.

And this summer almost half of France stayed home instead of taking a holiday.

A woman looks at real estate ads in Paris
A loan for a mortgage is impossible without a big deposit in France

Such cautious consumer behaviour has hardly kick-started the economy - growth this year is expected to be around 1% - but it has left France less exposed than some other countries.

And despite the government recently having to bail out the Franco-Belgian bank Dexia, the banks here are generally extremely cautious, too, spreading their investments widely.

They are extremely fussy about who they will lend money to. You can pretty much forget buying a house here unless you have a 20% deposit.

The tough rules have not exactly encouraged this country to become a nation of home-owners, but they have protected thousands of people from having their houses repossessed.

All my French friends complain constantly about the endless amount of facts, proof of solvency and personal details banks demand from them, before they even consider signing a loan agreement. But they are equally well aware that a "no money down, no questions asked" policy has been America's undoing.

Wary of ostentation

"They should be locked up," my ophthalmologist Mr Arnaud said as he measured the dilation of my pupils.

"It disgusts me to think of those British and American traders who recklessly gambled ordinary people's money, driving around in their flashy cars and spending their shameful bonuses," he added.

Carla Bruni and Nicolas Sarkozy
Mr Sarkozy's fondness for luxury and glamour has not endeared him to all

Green eye, Monsieur Arnaud? I do not think so. If the French are prudent with money, then they are also extremely sensitive about ostentatious displays of having it.

In his first few months of office, President Sarkozy was slated by the French press for showing off his trappings of wealth, holidaying on luxury yachts and dripping in gold chains and Rolex watches.

"He gorged himself on happiness," one newspaper said, "while the French people themselves were starved of it."

This week, the same French leader will present a new bill to parliament to restrict the system of golden parachutes, or lavish pay-offs.

"Your glasses are slightly too weak," Mr Arnaud said as he finished my examination. "Do you want me to update them for you?"

I told him I always wore contact lenses and only kept glasses for emergencies.

"Don't bother then," he advised me. "Keep your money for other things because we'll be feeling the fallout of this financial crisis here, I can tell you."

The unspoken motto of France, I laughed to myself as I left Mr Arnaud's surgery, "save your money for a rainy day". Walking into the Paris street, I noticed it had started to drizzle.

From Our Own Correspondent was broadcast on Saturday, 4 October, 2008 at 1130 BST on BBC Radio 4. Please check the programme schedules for World Service transmission times.

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