There is a school of economics, sometimes called the "freshwater school" (from the Chicago School and Milton Friedman) which claims you can't run out of demand. This is a classic position. But productivity is now so good that we
can run out of demand. Classically, countries ran out of land, labor, capital, or management before they ran out of demand. There were occasional recessions, but that wasn't a permanent condition. That's over in the US. Plenty of land outside NY and SF, lots of workers (some might need retraining, but it's not like the real labor shortage of WWII), oceans of capital, and lots of experienced managers. But nothing to do with it, because the demand isn't there.
This is an alien concept to many people and economic policy makers. See the parent article. They report on a capital glut, but are puzzled that it exists. The Fed keeps pumping capital into the economy in hopes it will fuel growth. But pumping capital into a capital glut doesn't do much.
Look at Japan since 1989. Japan hit this about two decades before the US did. They never really figured out what to do about it. That's discouraging, because if Japan had a solution, we'd have a success to look at.
So nobody really knows what to do about a capital glut and a demand shortage.
This is an alien concept to many people and economic policy makers. See the parent article. They report on a capital glut, but are puzzled that it exists. The Fed keeps pumping capital into the economy in hopes it will fuel growth. But pumping capital into a capital glut doesn't do much.
Look at Japan since 1989. Japan hit this about two decades before the US did. They never really figured out what to do about it. That's discouraging, because if Japan had a solution, we'd have a success to look at.
So nobody really knows what to do about a capital glut and a demand shortage.