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Politics : Formerly About Advanced Micro Devices -- Ignore unavailable to you. Want to Upgrade?

To: Tenchusatsu who wrote (584841)	9/17/2010 11:30:45 PM
From: combjelly	Read Replies (1) \| Respond to of 1571370

"But you did try to use Japan as an analogy of why a rising savings rate is bad." See, there you go. Again. I did no such thing. You presented it as something with no downside. It isn't anywhere nearly so simplistic. As I pointed out. "Tell me again why a ri*sing savings rate is bad here" I will try. As, I am sure, you will try to twist it into something else. Savings at this point in time has some negative effects. The biggest is that the savings are coming out of the consumer economy. Which accounts for the majority of our economic activity. So the economy slows down, or even contracts. In other words, exactly what we are experiencing now. Or have you noticed? And where is the money going? Into savings accounts and money markets, for one. Which far exceeds what the banks need for the loans they want to write. Which is why the interest rates on them are close to zero. Bonds is another place. Ditto for those rates. Even for 10 years out. Even the 30 year yields are not too great. Businesses are pushing to sell bonds because they are sitting on excess capacity as it is. It doesn't make sense for them to invest in much more than maintenance and maybe not even that. Now this is not to say there is no upside. There certainly is. Paying down consumer debt is a big plus. But to pretend there is no downside at all is, well, more than a little simplistic. " Even Suzy Orman," Dunno who she is. I guess she is yet another one of the boogey men the Right seems to delight in.