If there truly is a savings glut, more immigration from lesser-skilled countries ought to do wonders. Those laborers would soak up more of this capital investment as if they are a free lunch. No domestic worker would have to end up with less capital invested, precisely because of the glut. And by drawing down the “glutted” stock of savings through conversion into productive investment, the immigrants start to pull the economy out of a liquidity trap. It seems also that the conversion of capital into immigrant wages should boost consumption, which at times has become the new (and wrong?) stand-in for aggregate demand.
I should stress that I do not find the “savings glut” terminology to be useful. But if. Do the advocates of the savings glut argument in fact draw this conclusion? Isn’t this actually a good form of (indirect) fiscal policy?
Addendum: You’ll notice that if the savings glut is global, you do need lesser-skilled immigrants because they have to come from countries where less capital is invested per worker. But if the savings glut is better understood as a regional or national phenomenon, immigrant labor from Sweden would do the trick too.