The rich get richer and rates get lower

Re:The rich get richer and rates get lower by henron on Tuesday August 31, 2021 @09:03AM (#28367526)

As long as the real rate of return is positive and wealthy people have a higher income or save a higher percentage of their income, inequality will increase. Hence inequality almost(?) always increases in times of stability. You don't need low interest rates to tell that story.

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Re:The rich get richer and rates get lower by fny on Tuesday August 31, 2021 @09:14AM (#28367644)

This isn't the transfer mechanism.

When interest rates decrease, leverage is cheap and financial asset prices balloon, so the rich become far richer. The problem with crises is that the rich are often the only group with enough of a cash balance to take advantage of fire sales that happen. Banks also become far more restrictive in lending to those without hefty collateral buffers in a crisis.

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Re:The rich get richer and rates get lower by NewLogic on Tuesday August 31, 2021 @09:26AM (#28367772)

This time the banks have learnt the govs of the world aren't willing to let anyone go under, so have been making out like bandits lending out cheap money.

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