31. To mainstream economists the persistent U.S. trade deficit mainly reflects the inability or unwillingness of the United States to finance its investment fully out of domestic savings. 32. Vast domestic savings and sheer hard work effectively masked the fragility and lack of sophistication of institutions that support modernization in a capitalist economy. 33. With domestic savings very low, the only way to cover the imbalance was with foreign money, usually raised through the sale of treasury notes and bonds. 34. Zedillo said the budget should address fiscal and monetary discipline, domestic savings, structural changes and education, the paper said. 35. Also, the government will study the feasibility of offering tax-exempt savings bonds to encourage domestic savings, he said. 36. Also, high domestic savings limit their requirement for external capital, the Outlook said. 37. BMB is better positioned to repay its debt to the FIDF than other state-owned banks, following its strong drive to raise domestic savings. 38. China also plans to tap its huge domestic savings and increase investment in infrastructure to keep the economy growing. 39. Despite the IMF call for raising interest rates, these measures have done little to encourage domestic savings. 40. Demand for alternative savings funds from Japanese investors is rising due to record-low domestic savings rates. |