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ArtikelStashing the Cash; Corporate Saving and the Budget  
Oleh: [s.n]
Jenis: Article from Bulletin/Magazine
Dalam koleksi: The Economist (http://search.proquest.com/) vol. 402 no. 8776 (Mar. 2012), page 52-53.
Topik: Economic Crisis; Public Sector; Budget Deficits; Economic Impact
Ketersediaan
  • Perpustakaan Pusat (Semanggi)
    • Nomor Panggil: EE29.70
    • Non-tandon: 1 (dapat dipinjam: 0)
    • Tandon: tidak ada
    Lihat Detail Induk
Isi artikelPublic borrowing could be safely cut if only firms would stop hoarding money. How the economy holds up under fiscal tightening depends on the private sector's response. If companies and householders attempt to save hard even as the state tries to borrow less, the economy will falter. But if companies, in particular, stop hoarding cash and instead use it to invest and hire, the government could safely cut its borrowing without choking recovery. Growing confidence about the world economy might persuade firms to loosen their purse-strings. The government's large budget deficit could not be sustained indefinitely; the same goes for the corporate savings glut. At some point firms will feel they have enough of a cash buffer and, with bank-deposit rates so low, the scales will tip from saving to spending. Some of the money will probably be used to buy other companies. Mergers and acquisitions would have a smaller impact on short-term GDP growth than would building new factories or updating equipment - particularly if firms use their savings to build a presence in emerging markets.
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