Inequality, not gerontocracy

Who killed interest rates?

Cory Doctorow

--

A chart labeled ‘Savings rates across the within-cohort income and age distribution,’ from Mian, Straub and Sufi’s ‘What explains the decline in r∗? Rising income inequality versus demographic shifts.’

The received wisdom among economists is that the US’s historical low interests rates are driven by high savings by aging boomers who are getting ready for, or in, retirement.

The idea is boomers have salted away so much cash that banks don’t bid for their savings, so interest rates fall.

--

--