Mathew Forstater writes: 
> 
>1. What about the role of credit, modern financial institutions, and 
>government policies in decreasing the need to rely on a pool of 'savings' 
>to finance investment? 
 
As James Akiaphor responded, the resources to finance any of these 
options must have eventually come from income earned from productive 
activity by individuals or firms.  Those activities do not decrease the 
need to rely on a pool of saving, rather, as many of the "classical" 
as well as inter-war economists understood, it decreases the need to 
rely on the public's *voluntary* saving.  Hence the many debates over 
the notion of "forced saving," or in D. H. Robertson's terms "auto- 
matic lacking."  Government policies designed to stimulate consumption 
in ways other than those that encourage general economic productivity 
must acquire the purchasing power they transfer to some members of the 
public from other members of the public. 
 
Steve Horwitz 
St. Lawrence University 
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