The economy simply isn't that sensitive to interest rates anymore:
1) Services make up 2/3 of consumption (& 61% of production)
2) Manufacturing has been flat since China joined WTO in 2001
3) Employment almost all in services
3) Banks aren't only game in town for loans ๐งต
1) Services make up 2/3 of consumption (& 61% of production)
2) Manufacturing has been flat since China joined WTO in 2001
3) Employment almost all in services
3) Banks aren't only game in town for loans ๐งต
We import our goods--no need to manufacture them. 2/7
Business spending on information processing equipment exceeds spending on industrial equipment by 2:1. 3/7
the information economy: we're investing $1.43 trillion on intellectual property. That's where growth is today. 4/7
Just 10% of employment is in manufacturing & construction. Down from 1/3 in the 1950s. 5/7
Banks have to compete with private equity, private credit, VCs and distressed asset funds these days. SLOOS just isn't that important anymore. 6/7
Producing goods is capital intensive & requires financing. Consumers borrow for big-ticket purchases. No need for financing when you termed out your debt and focus on services.
And services are perpetual: you can keep going to concerts. Demand for washer/dryers is finite. Fin.
And services are perpetual: you can keep going to concerts. Demand for washer/dryers is finite. Fin.
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