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Canada’s Richest 1% Nearly As Wealthy As Poorest 80% (www.readthemaple.com)
submitted 5 months ago by to c/canada@lemmy.ca
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19% would be the complacent middle class 🤮

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[–] 1 point 5 months ago (1 child)

Well the late 80s in the second to last chart was when the US excluded housing from the CPI, which dramatically cut interest rates. What makes you think the wealth isn't created via lower interest rates, which came from untethering the CPI to reality?

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  • [–] 3 points 5 months ago* (last edited 5 months ago)

    I don't think interest rates created that wealth for two reasons.

    One is because of contradictory trends - interest rates were higher (3-8%) duding the 1800-1930 period of rising inequality than during the late 80s-onwards period. Also interest rates were lower (0.5-4%) during the 1930-1965 period of decreasing inequality. Rates fell persistently under that level only after the dotcom bubble in 2001.

    The other reason is is that given I can see brutal inequality happening during the 19th century without many of the modern financial instruments (and across diff countries), I have to conclude that there's a more fundamental process that drives inequality. For me the best explanation so far is the process of capital accumulation which inherent to this economic system.

    E: If you wanna see another consistent (inverse) correlation, look at how tax rates evolved during these periods.

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