That stimulus to consumption offset a shortfall in business investment and exports.
In developed economies with chronic shortfalls of consumption and investment, workers have long known what academic economists have recently realised: one worker's job match is another's missed opportunity.
We have a weak economy because the housing bubble collapsed," said Baker in a note to HuffPost and Politico "The collapse cost us $700 billion in annual construction demand and $500 billion in annual consumption demand, for a total shortfall in private sector demand of $1.2 trillion".
The shortfall in water consumption relative to the IOM AI values for each age group is also indicated in Figure 1.
But many state and local governments, desperate for revenue in the wake of major budget shortfalls, are raising consumption taxes through general sales taxes, and also individual excise taxes and fees for everything from alcohol to birth certificates to vehicle registrations.
It is possible that many of them have watched their wealth decline, and they may be diverting some consumption toward spending to make-up for an expected shortfall in post-retirement income, but others are just buying less.This is a part of any economic downturn what economists like to describe as an economy-wide increase in the demand for cash.
The shortfall should be made up by other income and consumption taxes but largely by cuts in spending, he said.
China is still banking on a recovery in Western demand next year, as domestic consumption cannot rise fast enough to make up for the exports shortfall.
So far, the shortfall has been made up by higher government spending and personal consumption.
The first chart in the report, which illustrates how energy consumption is outpacing production, uses a mix of government statistics to make the future shortfall in production seem more acute than it might turn out to be.
