Report Detail Summary

Around the World in 90 Days: Income Statement and Balance Sheet Recessions

June 28, 2011

When wealth is destroyed, the economy works to rebuild it. There are two possibilities for this: one is asset appreciation and when that is not enough the savings rate makes up the difference. When asset appreciation is well above the optimal long run rate of wealth accumulation, consumption may increase over and above the income levels and the economy could experience a negative savings rate.

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