And to clarify: I wasn't asking for explanations, everything in that sentence is wrong in macro monetary terms
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Jorge Bielsa-Callau
Let me jump in: It's a cryptic phrase that condenses several empirical-theoretical implications from accounting identities. You can find a complete explanation in Michael Pettis's texts-posts.
And yes, investment represents all that isn't consumption, which is a very vague definition, but it is key.
And yes, investment represents all that isn't consumption, which is a very vague definition, but it is key.
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Sometimes, what works in monetary macro terms doesn't hold up in straight macroeconomics.
Anyway, I just wanted to clarify where the phrase might come from.