tag:blogger.com,1999:blog-8897997766931633186.post3075664093442656593..comments2024-02-14T03:21:37.506-05:00Comments on Monetary Freedom: Sumner and Glasner on IdentitiesBill Woolseyhttp://www.blogger.com/profile/06330232724290161369noreply@blogger.comBlogger2125tag:blogger.com,1999:blog-8897997766931633186.post-29366085068682983902015-02-14T16:57:07.748-05:002015-02-14T16:57:07.748-05:00Summers argument (as you summarise it) is wrong. I...Summers argument (as you summarise it) is wrong. If wage income falls, but workers dip into savings to keep up consumption, business profits will rise. The extra profits are a source of savings, and will allow investment to be unchanged.Brian Romanchukhttps://www.blogger.com/profile/02699198289421951151noreply@blogger.comtag:blogger.com,1999:blog-8897997766931633186.post-1540551577110507842015-02-14T12:00:24.986-05:002015-02-14T12:00:24.986-05:00I'm trying to imagine this in an economy with ...I'm trying to imagine this in an economy with no money.<br /><br />In a given period a certain qty of stuff is produced. Some of it is consumed. The difference , whether new production goods or unused consumer goods, can be defined as both investment or savings and by definition (and it terms of physical goods) will be equal, (consuming already existing consumer goods, and wear and tear on investment good I will ignore for simplicity).<br /><br />If for some reason people decide to consume less of the produce one year then the stockpile of existing goods (defined as both physical savings and investment) will grow.<br /><br />However with that bigger pile of goods, and with the expectations that people will again consume less, in the next period output, investment and savings may all change together as people choose to produce less consumer goods and investment goods and run down their stockpiles a bit.<br /><br />If you introduce money to the above process then as long as you define the accounting terms appropriately so you can give money values to stocks of physical goods as well as flows (where money really changes hands) then I think you end up with the same results.<br /><br />S = I at all times, but changes in S (and therefore) I may lead to changes in Y.Market Fiscalistnoreply@blogger.com