Lots of good comments.
Warren: Comes down to further purpose.
If the purpose is simply to show that one sector's increase in net financial assets have to come from another's decrease, 2 sectors are fine, and maybe 3 to further make the point and show the possibilities.
If you are trying to determine if the household sector is getting over leveraged, or is under leveraged and might be ready for a credit boom, you want to further subdivide the domestic sector into households and businesses, etc.
So subdividing sectors can be a tool of discovery.
And when looking at the euro, turns out the high deficit member nations have high household savings of net financial assets with a very low leveraged consumer, whatever that might mean. Again, it's all about your further purpose of analysis.
So I'd ask JHK, why do you care about 'savings per se' whatever that is? and 'what do you mean by 'the underlying savings dynamic' and why do you care about it?' and yes, corp savings can be 'condensed' to households, which is the argument for many things (including eliminating all corporate taxes) but what specifically are you trying to get at here? that is, what's the further purpose of you're inquiry? And high corporate liquidity probably isn't going to help someone make his mtg payment even though he is a shareholder via his pension plan, etc.
that is, JHK is stating a few things, obvious to some of us, not so obvious to others, but without some further purpose expressed it's not all that interesting and I don't see much to comment on?12:19 PMWinterspeak.com
Confused about MMR