Public Investment and Public Money

public investment: Summers said that research by the International Monetary Fund had shown that "appropriate public investment" leads to a lower public debt-to-GDP ratio after five years than occurs in the absence of such investment, according to Deutsche Welle. In other words: Done right, infrastructure investment more than pays for itself. The benefits of pouring public money into infrastructure would include more jobs and stronger demand, an expansion in Europe productive capacity, and a reduced burden on the next generation. Long-term stagnation Summers attributed weak economic growth and very low interest rates in Europe and other developed countries to "secular stagnation" - which he described as a chronic excess of savings over investment. The result: Chronically low interest rates and weak GDP growth. Several factors - including rising inequality and cheaper technology, among others - had led to a situation where wealthy savers had a great deal of money available to invest, but too few profitable projects to invest in. (news.financializer.com). As reported in the news.