In 2008 the New York Federal Reserve republished the comic book: “A Penny Saved – Why and how we save, and how savings helps the US economy”.

The comic is worth a read, it concludes that the declining savings rate at the time was bad for the economy. That is, of course, what most of us were brought up to believe. Contrast that with the world we live in today.

Economists tell us we are all doomed as a consumer society if we don’t spend more. To the point that savings are being confiscated in some countries by way of negative interest rates. So, lose your cash or spend it.

This is the standard, myopic Keynesian view. More debt, more spending and all will be well. It does not allow for the fact there may be other, underlying structural problems causing our current malaise.

Anyway, get the comic here for a dose of nostalgia. gov.frb.ny.comic.penny

More FED comics here.

13 August 2015 Macro