Posted on 10/24/2015 10:50:17 AM PDT by ForYourChildren
During HSBC's Global Investment Seminar in New York this week, Harvard professor and economist Larry Summers brought up secular stagnation.
In 2013, Summers revived the phrase, which, over time, has come to mean all sorts of things to different people. But at its core, secular stagnation refers to a global economy growing at a slow rate because there is too much saving and not enough investment.
And right now, a lot of savings (and other monies) are heading out of emerging markets and into the developed world.
"I would suggest that the defining financial development of the last year is likely to push things towards more secular stagnation," Summers said this week at the HSBC seminar.
"It is the substantial reduction in capital inflows to developing countries, and the substantial increase in capital outflows from developing countries."
Here's the chart from Summers' presentation, which shows the decline in money coming into emerging markets.
(Excerpt) Read more at businessinsider.com ...
“..economy growing at a slow rate because there is too much saving and not enough investment.”
These people are fools!
The average American household has had income go done from $58,000 to $54,000 since 2008, while prices of goods have gone up over 40%.
No one is saving!!
Everything is going just the way the global communists have it planned. Enslave the entire world and send ALL of the people into poverty.
Remove taxes and regulations on businesses and the people; and watch the economy take off. Taxes and regulations are killing us. The government is out of control and is suffocating us.
Or, the people can just do as Jeb Bush said, "It means that people need to work longer hours and, through their productivity, gain more income for their families."
Hmmph, I feel Boxer in Animal Farm.
I agree.
Summers should have been Chairman of the Fed instead of affirmative action Janet Yellen.
The feminazi’s were all bent out of shape due to a comment he made while at Harvard that didn’t square with the anti-male narrative of womyn, and 0bama took the line of least resistance and picked Yellen.
Can anyone say we’re better off with Dove Yellen rather than Larry Summers? I don’t thinks so.
Pssst! The underlying cause is demographics. As there are fewer young people and more old people, spending and growth are going to go down. Japan, China, Europe, and then the US and Canada.
$9000 for health insurance for 3 that will be next year for us $13000.
Well over $35000 in taxes between state, federal, property, fuel and sales.
About another $7000 a year for our only child’s educational and skill development.
If I wasn’t able to figure out how to win on the slots I wouldn’t have saved hardly a thing this year to be truthful. Life and big government are too expensive.
I have been paying down debt for the last 7 years and am almost debt free now, including my home.
how do you win at the slots?.....
Too much savings. You’d have to have
a heart of stone not to laugh out loud
at nonsense. The interest rate on savings
and money market accounts is so low,
it’s no better than zero. There’s no
point in putting money there.
I have a $10,000 money market account
and over the last year it has earned
the royal amount of $2.23.
Well the older ones like me have unique expenses as well. The home is paid off, but over recent years I’ve had to:
Copper pipe the house. Thousands
Remove all carpet, sand wood floors and finish another room floor. $11,000.
Re stuccoed the house myself and painted after changing all the windows to new vinyl myself. $9000 not counting my labor.
After 50 years did mildly over three bathrooms and a kitchen. $37,000.
Still have another $6000 of work to do and I see the roof will need to be done in 7 years.
So, there is spending on keeping the house together, my clothing at times can be a bit of a hot mess, but who has money for clothes outside of my wife and child?
Both Yellen and Summers are tools. What difference does it make when whoever is there at the fed is interchangeable with another tool?
For what it’s,worth, didn’t Summers lose a couple Billion from one of the Ivy League trust funds Making poor assumptions on the economy?
I don’t understand the concept of “savings vs. Invistment.” Is this part of thd Leftist concept of “taxes = investment?”
The left likes to say that taxes are an investment. However, investors (taxpayers) expect a return on their investment. I have yet to see any return on the investment - ever. The government is running a $17 trillion debt.
I don’t want liberal parasites telling me how to handle my money.
I am very visual and observant and despite the random number generator can spot a “happy machine” ready to pay or give spins.
I take 700 with me.
I use small bets to try and find machines.
I keep my casino card in until I find the hot machine so it registers my losses but not all my wins because casinos love losers.
Once I find a machine about to pay I up the bet a little. Machines NEVER pay on the small bets.
After I get the first pot I use their money to make money betting between 90 cents and $3 on their nickel.
Last time despite my skills I went down almost 500 before finding happy machines. Up $900 last time. $1600 before that. $800 before that.
6 out of 7 times I win between 600 - $3000. The 7th time I lose 500 because there were no happy machines to be found.
I was just given a free cruise from the casino and get all the free rooms I want because of all the losing THEY THINK I do.
I go about once every three weeks and keep it under the radar.
Penny or rarely Nickle machines.
Yea, “I don’t want the liberal parasites telling me how to handle my money either.”
But with the goofy elites in charge, they keep up the mantra that we are saving too much and that is the problem.
The mantra is that we are “hoarding our money.”
Examples:
“Today, the growing concern is that Americans are starting to save too much.”
“In the long-term, it’s best for Americans to save more. But right now, with the economy underwater, it’s the worst time for that,” said Rich Yamarone, director of economic research at Argus Research.”
http://money.cnn.com/2009/02/12/news/economy/savings_rate/index.htm
“Meanwhile, the American economy, which is powered by consumer spending, limps along while those with money to spend hoard it instead.”
http://fortune.com/2015/05/13/savings-retail-sales/
The fact is that the average American isn't saving a dime. The real income of the average American household has fallen by more than $5,000 per year. That is more than $400 a month. A car payment.
Add to that lower income a massive increase in insurance costs, property and even income taxes in most areas as well as expanded fees and utility costs. It isn't that people are saving, it is that they are spending more on the things they MUST have and forgoing luxury and specialty items.
How can you have investment without savings? I can spend money on current consumption or I can save it for later. Unless I shove those savings under the mattress, I will either put the money into a savings account which the bank will then lend out or I will put the money into the stock market to invest. One thing is he may be considering individuals and businesses paying down debt to be "savings". Because of fractional reserve banking, every dollar less debt results in many fewer dollars in circulation.
I know that I'm aiming to get down to zero debt and remain there.
What's happened with savings is that quantitative easing has leached the value of people's money. So even if it wasn't spent, the government has used up the value of saved money.
Unfortunately, the value has been squandered on attempts to spur the economy, while at the same time using regulations to strangle business.
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