Glen L.

Markets Have a Long Way to Go

Kelm,

I agree with your post, except that you seem to be buying into the "paradox of savings" fallacy of J.M. Keynes. If Americans achieve a 10% or higher savings rate it will be a good thing, mitigated only by the length of time it takes the banks to start lending out that saved money. Since they pay interest on savings, the answer is that they'll lend it out asap. And the bonus is that this is real money earned and saved by people, not money that rolled off the Fed's electronic printing press.


>Seriously, the American consumer needs to repair their personal balance sheets and get back to fiscal discipline at home. That will be painful for the economy but it is completely necessary. We cannot just go back to the mass leveraged consumption that created this mess.