3 ms·

The real startling link is between wealth inequality and high crime.

• suoduandao3 3y ago
  Given that high interest rates mean it's very advantageous to have money, might interest rates just be a leading indicator of wealth inequality?
  • somewhereoutth 3y ago
    As it turns out, low/zero interest rates since 2008 have led to asset bubbles just about everywhere - which of course benefits wealth holders. Housing being the most egregious example. Hopefully the return to normal rates will deflate those asset bubbles.
    • randomdata 3y ago
      Thing is, for as insane as they may seem on the surface, assets prices have managed to keep in line with the return on investment. The returns are where the gains have really been made. In other words, it is not so much an asset bubble as it is a consumer activity bubble. Which is unsurprising as that is specifically why the rates were lowered in the first place – to spur on consumer activity when it started grinding to a halt in 2008. And why rates have risen again recently – to try and tame consumer activity amid a supply chain no longer able to keep up with it. So, yes, as consumer activity declines, asset values will go with it. But that also means less for the average Joe. As people have to do with less, it isn't too hard to think that crime will increase as a result. When there are no longer toys to placate them, people will find something to do.