If a lot of people suddenly decide to consume less (as they have since 2008), then they save more. The money they put into the bank is, ideally, productively i

If a lot of people suddenly decide to consume less (as they have since 2008), then they save more. The money they put into the bank is, ideally, productively invested; that investment creates new demand, and then there's no such thing as a demand shortage. In that model, you would be right. However, that's not what we actually see. Foregone consumption is not automatically channelled to productive investment. If you own a company, you have no reason to invest in increased production capacity if no one will buy your increased output. And why is no one buying that increased output? It's partly an issue of distribution; the wealthy have a lower marginal propensity to consume. A lot of people and companies actually are sitting on big piles of cash (or other short-term, low-risk investments that don't do much to increase productive capacity). This is part of the reason why interest rates are so low.