Answer :
The letter to editor regarding the disagreement with your article of 2017 titled “The Role of Saving and Investment”. In Box 4 of this article, is written.
Dear Editor,
I am writing this letter to express my disagreement with your article of 2017 titled “The Role of Saving and Investment”. In Box 4 of this article, you state that System of National Accounts (SNA) can be regarded as available finance for investment and saving, and I strongly disagree with this claim.
Firstly, SNA cannot be regarded as available finance for investment and saving because it is not a liquid financial asset. SNA refers to an accounting system that tracks the economic transactions of an economy, but it does not represent actual savings or investments. Thus, SNA should not even be called saving as it is a mere accounting identity rather than a true financial asset.
Secondly, I also disagree with your claim that savings imbalances between Germany and the US are responsible for current account imbalances between these countries. This claim ignores the fact that current account imbalances can also be caused by factors such as exchange rate movements, productivity differentials, and differences in demand for goods and services.
Therefore, focusing solely on saving imbalances overlooks other crucial factors that contribute to current account imbalances.In conclusion, I urge you to consider more in-depth analysis of these issues before making claims in your articles. I recommend that you refer to Borio and Disyatat (2011) for a better understanding of the role of savings and investments in the economy.
Sincerely,[Your Name]
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