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Thursday, January 19, 2012

Why do we believe that S = I?


Read it at Rogue Economist Rants
Why do we believe that S = I?
by Rogue Economist

3 comments:

  1. Man, this argument is ridiculous. Each new article is even less helpful than the last. Not only can economists not agree on anything, they can't explain anything either.

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  2. I didn't understand TC's comments on the matter either, fwiw.

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  3. What all these arguments are missing of course is the 'I' of last resort - central bank reserves.

    And as usual the problem is that the equation is being read as an time based implication, not an equality at a point in time.

    So really I = S (ie I => S).

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