Leading economist suggests "better designed" government stimulus

Consumer spending, which represents 70 percent of the economy, and personal incomes were unexpectedly flat in June as Americans opted to save their money as the sluggish job market weighs on the economic recovery, according to a Commerce Department report earlier this week. 

"The recovery is so weak that it is not strong enough to generate new jobs for the new entrants in the labor force, let alone to find jobs for the 15 million Americans who would like a job and can’t get one," Stiglitz said. 

"Unfortunately, with savings going up to 5, 6, 7 percent, aggregate demand is going to be weak," he said. "The only thing to fill it is government."