4 ms·
Sure but then the savings reference breaks down. Bonds and corporate bonds in particular shouldn't be considered "savings" because the money is being circulated
by vladimirralev 7y ago
Sure but then the savings reference breaks down. Bonds and corporate bonds in particular shouldn't be considered "savings" because the money is being circulated. I am sure everybody has a different definition but in the "global savings glut" phenomenon those savings shouldn't include bonds?
- skybrian 7y agoYes, this is a matter of definitions, but it looks like the people writing about "global savings glut" are including short-term corporate bonds. But the reason there is a choice of definitions is because all lending creates money if the debt is considered reliable and can circulate like money. It's quite similar to the reasons that bank deposits are considered money. You can use a stricter definition that doesn't include bonds but I'm not sure why you prefer it?