Savings

  • There has been a colossal build up of savings at households.
  • By Q2 Goldman’s expects this to be 11% of GDP.
  • Many think this could be unleashed leading to a huge recovery.
  • It is important not to view savings in one sector outside of the savings/dis-savings of other sectors (especially the government sector).
  • This is an idea popularised by Richard Koo as a way to understand the great financial crisis.
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