Isn't it nice when people do not spend? Ergo, they are saving? Not really. When people do not spend, there is no cash that revolves around the country. There are no investments to speak of, therefore, there will be no jobs created, and no cash flow.
When I was new in Japan, I heard that they their economy is in bad condition. I thought then that if that were a bad economy, what about my home country, the Philippines? As I stayed longer, I slowly felt what they say that the Japanese economy going down. The scholars' monthly allowances were slashed annually, less educational trips, and all. I hope that Japan will soon recover as this global crisis is making many people's lives difficult. But if Japan and many other nations experience financial crisis, who become richer?