Talk abounds of a global savings glut.

The global savings glut is the result of this perverse relationship.

The puzzle of the global savings glut may live on for several years to come.

America certainly does not have a savings glut.

America has a savings deficiency, not a glut.

Both the savings shortage and savings glut hypotheses confuse accounting outcomes with causes.

Consequently, rather than facing a savings glut, the global economy faces a problem of demand failure in developing countries.

But no solution is possible until we abandon the savings shortage and savings glut hypotheses and connect today s global financial imbalances with global production patterns and inadequate demand in developing countries.

Ben Bernanke, the US Federal Reserve chairman, once famously pinned the whole US current account deficit on a global savings glut.

This East Asian savings glut enabled a debt fuelled consumption glut in the US, Britain, and much of the Western world.

Talk abounds of a global savings glut. In fact, the world economy suffers not from too much saving, but from too little investment.

US Federal Reserve Board Chairman Ben Bernanke s notion of a global savings glut is a commonly cited explanation for falling world interest rates.

First and foremost, there is the global savings glut, an idea popularized by current Federal Reserve Chairman Ben Bernanke in a 2005 speech.

US Federal Reserve Board Chairman Ben Bernanke s notion of a global savings glut is a commonly cited explanation for falling world interest rates.

And the rest of the world? A global savings glut would suggest that rebalancing the world economy requires policies to boost America s savings rate and to increase non US households consumption.

Fear as much as institutional blockages may be the source of what is either a global savings glut or a global investment shortfall, depending on how you view it.

This story is fundamentally different from the savings shortage and savings glut hypotheses, and it leads to dramatically different policies.

The natural interest rate was low because, as the Fed s current chairman Ben Bernanke explained at the time, the world had a global savings glut (or, rather, a global investment deficiency).

But what the world economy is facing is not a savings glut, but an investment deficiency.

The same problem haunts Bernanke s hypothesis that slow growth reflected a global savings glut. From a Keynesian perspective, an increase in savings cannot explain the surge in activity that the world witnessed in the early 2000s.

The problem of current account imbalances is closely linked to the existence of a world savings glut.

If the US is unable or unwilling to run the required deficits, the global economy will flounder in a savings glut of low demand and cheap capital until another alternative emerges.

These days the Chairman of President Bush s Council of Economic Advisers, Ben Bernanke, likes to talk about a global savings glut that has produced astonishingly low real interest rates around the world.

American officials have long bemoaned China s saving glut as a major source of global instability.

Thus, there is a global slackening of aggregate demand relative to the glut of supply capacity, which will impede a robust global economic recovery.

Neither would it have stopped the global saving glut from turning into a ticking time bomb for the world economy.

Remarks by Federal Reserve Governor Ben S. Bernanke at the Sandridge Lecture entitled The Global Saving Glut and the U.S.

Indeed, it is misleading to term this situation a savings glut, for that would imply that countries running current account surpluses should reduce domestic incentives to save.

Ben Bernanke, the Chairman of President George W. Bush s Council of Economic Advisors and a likely candidate to succeed Alan Greenspan as the Federal Reserve s chairman in January, has called the decline in real interest rates over just the last decade a global savings glut.

If nominal and real depreciation (appreciation) of the deficit (surplus) countries fails to occur, the deficit countries falling domestic demand and the surplus countries failure to reduce savings and increase consumption will lead to a global shortfall in aggregate demand in the face of a capacity glut.

Some blame a global savings glut for this state of affairs, and call for less thrift. But if we were at full employment, we would recognize that the world still has mammoth growth opportunities, and to sacrifice future growth for current well being is a second best choice.

Apart from accounting for the global divergence in savings rates, tight credit constraints in China might explain the country s high, and rising, savings rate especially as the large rise in national savings is attributable mostly to household savings.

9. The shortage of global savings in relation to the requirements for global investment has emerged as a major policy issue.

According to standard trade theory, a global labor glut ought to imply an increased rate of return on capital, which again pushes interest rates up, not down.

It feels like we're all suffering from information overload or data glut.

There were no protective mechanisms to prevent a global liquidity glut from developing, and then, in combination with US regulatory failings, from producing a spectacular housing boom and crash.

Restoring America s savings investment balance implies a reduction in global aggregate demand of around 800 billion.

Moreover, China s aging population, and its strategy of boosting domestic consumption, will negatively affect global savings.

But forces beyond Madi s control even beyond his awareness are restraining cotton prices, creating a global glut that is largely the result of policies followed by the world s richest governments.

How does a savings glut translate into exports, given that households do not export? Likewise, if the US is consuming too much, why has it been closing manufacturing capacity, and why is there so much labor market softness?

How does a savings glut translate into exports, given that households do not export? Likewise, if the US is consuming too much, why has it been closing manufacturing capacity, and why is there so much labor market softness?

The global economy needs the surplus countries to sustain growth and reduce excess savings no easy task.

Bernanke s original speech emphasized several factors some that decreased the demand for global savings, and some that increased supply.

But, while global imbalances have preoccupied many observers, few have sought to explain the divergence in world savings behavior.

The glut of medical specialists on the labour market has also helped to achieve results.