May 30, 2014

China Sets America's Mental Trap

Stephen Roach, Project Syndicate

The Associated Press

As China changes its economic model, it will shift from surplus saving to saving absorption – deploying its assets to fund a social safety net and thereby temper fear-driven precautionary household saving. Conversely, America seems intent on maintaining its current course – believing that the low-saving, excess-consumption model that worked so well in the past will continue to operate smoothly in the future.

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TAGGED: United States, China

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