What will households do with their forced savings?

The fact that households are unable to consume during the lockdown s in response to the coronavirus crisis is resulting in massive household forced savings (we use the situation of the euro zone as an example). What will households do with these forced savings after the lockdown? The answer to this question is vital to forecast ing the economic equilibrium from the summer of 2020. At first sight, households may: Consume these savings. But if the level of uncertainty remains high, they would rather maintain a high savings rate; moreover, some restrictions on consumption may remain in place ; Buy housing with these savings. This is possible, although they are likely to want to deleverage after the crisis; Keep these savings in the form of money or government bonds, which will be the case if risk aversion remains very high; Transform these savings into risky financial assets (equities in particular), which would be the case in an intermediate scenario where uncertainty deters spending but enables purchases of riskier financial assets. We prefer the intermediate scenario where the savings rate remains high but savings flow back into real estate and equities.