Savings equals investment the best way to describe savings, or is there a better way

"Savings equals investment" is a simplified way to express an important economic identity, often referred to as the "Savings-Investment Identity." This identity is derived from the national income accounting framework and is a key concept in macroeconomics.

The identity can be expressed as follows:

$�=�$

S=I

Where:

• $�$
• $�$

The idea behind this identity is that, at the national level, total savings in an economy must equal total investment. In other words, the amount of money saved in an economy is ultimately used for investment in various forms such as business investments, infrastructure projects, or other capital expenditures.

While the equation

$�=�$

$�+(�-�)=�+(�-�)$

S+(T−G)=I+(X−M)

Where:

• $�$
• $�$
• $�$
• $�$

This equation accounts for the influence of government fiscal policy (T−G) and trade balance (X−M) on the relationship between savings and investment.

In summary, while "savings equals investment" is a concise way to express a fundamental economic concept, a more comprehensive form of the identity may be needed to capture the complexities of a real-world economy.