As income inequality has risen over the past few decades, resources have shifted from poorer households to richer ones. To the extent that the rich have higher propensities to save, more money flows into capital markets to fund investment.That's the first of six bullets he offers to explain why interest rates decline: over supply. He painlessly ignores the other side of the coin, which is that the rich have a long history of, and well documented, much lower marginal propensity to consume. In other words, throw more moolah at a rich man, say by substantially cutting his taxes, he'll put almost all of it into passive savings (not bloody likely, matey) and assets, like say, the stock market. Such folks aren't in the business of building "more money flows into capital markets to fund investment", but in chasing capital gains, not dividends or physical capital acquisition generated returns. As more moolah flows in, share prices rise and E/P (yes, the pros recognize the inverse) ratios drop to meet Fed instrument interest rates; modulo real risk. That's your answer as to why the stock market hits all time highs in the midst of a pandemic and depression. Mo money, mo price. Greg doesn't mention that, of course.
The other side of the income inequality is just that the 99% have, relatively, less to spend on consumer goods and services, so producers have less incentive to build or replace production. And, of course, they haven't. As usual with the micro-view of any macroeconomic problem, thanks be to Samuelson, it is assumed and asserted that macro problems are analyzed as if they're just a mass of micro problems. If this pandemic has shown anything at all, economically and quantly speaking, it's that the collapse of aggregate demand is what drives us into depression. It's a leading indicator, not trailing.
One might also speculate that technological progress is running up against Mother Nature. Once the periodic table was filled in, ignoring for practical purposes the super-heavy (mostly manmade) elements, the limits of invention were set. Yes, on the organic side, the number of molecules to be concocted is virtually infinite, but not so on the inorganic side. To the extent that software has eaten the economy, how will we pull off the equivalent of the farm to factory migration of the first half of the 20th, since the notion of re-training a 50 year old at-best-GED generic flunky into, say, a game coder. Or a C++ coder to write the next GL application? Moving from farm to factory, and better living standards, didn't demand significantly greater skill sets. One might reasonably argue that being a farmer takes more smarts than turning a wrench in Ford's River Rouge plant.
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