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Sunday, September 28, 2008

Why U.S. kept growing despite zero savings and fiscal deficit?

Answer: The U.S. economy has managed to grow in recent years, even though Americans don't save much and the government has run huge deficits, because foreigners kept lending. The same was true in the 1980s. Now the U.S. needs foreign capitals to keep lending. C. Fred Bergsten, director of the Peterson Institute for International Economics, a Washington think tank, says the Treasury will have to stage a "road show" to explain the rescue plan to overseas lenders who may be considering euro investments instead.

1 comment:

Anonymous said...

Good for people to know.