But Jim, I don't think that was the point he was making. It doesn't matter if you invest in gov't bonds used to finance productivity increasing infrastructure or in private stocks increasing productive investment, when you come to collect in either case it involves an income transfer from the state or the investor to the retiree to finance consumption. The ultimate consumption can not come out of 'saved consumption' but out of current production. Is that not right Doug?
Paul P
Devine, James wrote:
Paul Phillips writes:>Was it not Keynes that pointed out that you can not 'save up' for retirement pensions?<
yes, but if the saving corresponds to (real) investment in factories, a clean environment, infrastructure, etc., the latter can raise labor productivity, allowing future workers to easily pay for old farts such as myself when/if I retire.
Of course, Keynes was absolutely right that increasing saving doesn't automatically increase investment.
Jim Devine
