The Impact of Interest Rates on Incomes

A study by Imperial College Business School looked at the impact of interest rates. It found that if there's a 1% drop in interest rates it boosted incomes of those at the top, the top earners by 5%. The lowest earners saw just a half percent increase in their living standards. So lower rates have a larger impact on the value of assets than they do on disposable income. In terms of the level of reduction I want to see, private debt is running of the order of 200% of GDP. For most economies around the world, I think it should be 50%.