3 ms·

> save a bit and have that buffer. This kills the economy. If everyone saves then by definition spend goes down. And spend is what pays everyone, the cycle goe

> save a bit and have that buffer. This kills the economy. If everyone saves then by definition spend goes down. And spend is what pays everyone, the cycle goes broken and and next year pay decrease. and if you keep saving, it keeps going down, until everybody is on survival mode and nothing else is consumed. A healthy economy is dominated by debt that can be serviced, with a saving that is comparable. The larger them both are, the more healthy the economy. Jacking up the rates to 5-7 percent today will cause the fastest collapse in economic history. It's like communism: Yes there's equality but it means everyone is equal in being dirt poor. You might be able to avoid volatility, but at what cost?

PakG1 6y ago
> A healthy economy is dominated by debt that can be serviced, with a saving that is comparable. Not sure that you and gp are disagreeing. Whereas right now, statistics say that a lot of families don't have any savings. Need to save a bit to have comparable savings.
clairity 6y ago
> "This kills the economy. If everyone saves then by definition spend goes down. And spend is what pays everyone, the cycle goes broken and and next year pay decrease. and if you keep saving, it keeps going down, until everybody is on survival mode and nothing else is consumed." no, it doesn't just break, the economy readjusts. there's a practical lower bound to trade and consumption (we need food, clothes, shelter, energy, water, etc.) and prices for essentials would likely rise relative to non-essentials, as demand shifts around the economy and supply adjusts to match it. labor prices likely dip, as do capital returns, during the transition period. permanent savings would lower monetary throughput, but not necessarily velocity.