It looks like the private sector is starting to save more and/or invest less. The government deficit has stabilized, and so has the current account deficit. Given that the dollar is expensive and global growth weak, demand from the rest of the world will be relatively weak. In order to grow, demand must come from domestic sources then. The private sector, as I just wrote, does not seem to go on a spending binge (and into debt) right now, so it seems like expansionary fiscal policy is the way forward. Let’s see what 2017 brings.
econoblog 101
Data source for US sectoral balances (links to data and updated graph)
Dirk Ehnts | Lecturer at Bard College Berlin
Data source for US sectoral balances (links to data and updated graph)
Dirk Ehnts | Lecturer at Bard College Berlin
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