- 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.