We have an entity which literally fixes the interest rate through a variety of methods and yet we're talking about why rates are the way they are. Boggles the mind.
It'd be like arguing about why rents aren't going up in a rent controlled neighborhood. "Because there's excess housing and not enough renters" doesn't seem to really explain the process.
> We have an entity which literally fixes the interest rate through a variety of methods and yet we're talking about why rates are the way they are. Boggles the mind.
If you'd read just a tiny bit into macro economics (every intro textbook will work), it stops doing so.
You seem to be implying that Central Banks are lowering interest rates just because.
I think the point of the FT article is that inequality is causing there to be a need for lower interest rates, which causes more inequality, which causes even lower interest rates, which...
Virtuous / vicious cycle, depending on which side you're on.
It’s only virtuous until the money runs out. Then we will see far worse poverty than ever would have been.
When the US prints money we steal from every person in the world who uses a Dollar backed currency. I’m not sure how much longer they will tolerate this. They’re already not buying our bonds…
Honestly I think they will continue to tolerate it as there is not really much of an alternative. The world needs a unit of exchange, if it is not the dollar then what would it be? Maybe eventually something like BTC / ETH serves as the unit of exchange and is then converted back into the countries native currency?
China is producing their state owned e-yuan. They are rolling it now and in 2 years that will be the currency most transactions they do will require. 200 million has already been issued as a pilot. When e-yuan becomes the de facto reserve currency of trade, the dollar will suffer thge same tragedy as iceland.
The US will need to take out loans from the IMF, from China, from other nations in ASIA to buy e-yuan. China will pay us back in the dollars they have but will demand e-yuan for anything we want to buy from them. Now the Fed is enjoying its last hurrah. Printing money like its going out of style (which in fact it is) (Actually the Treasury prints the money but they wouldnt print unless the Fed issued bills and bonds to sell.)
When austerity hits home, the rich and privileged classes will have a new 'news bite' with which to beat the 'lazy unemployed'. Helicopter money will disappear. Austerity measures will include wage and price controls (like Nixon did in 1970s), sky high interest rates. And a booming underground economy as Americans learn to dodge taxes like the Greeks do. We will become like England. They were the host state to Arab oil money. We will see China buying up valuable parts of the US simply because we will have nothing else they want. Dont fool yourself, their weapons have reached parity withours. Their chip industry is at most 5 years behind ours. Their ML is at parity with 'ours' -facebook, google. OTOH, facebook and google might just move to china for the free-er capitalism they will have.
> Austerity measures will include wage and price controls (like Nixon did in 1970s), sky high interest rates.
^This is my biggest concern.
Thus far real estate has been my favorite investment. I assume though if interest rates go up peoples buying power and hence prices will go down. If I liquidate my investments I will owe taxes and I fear inflation will eat up the cash value.
I think that in that case the US would just move manufacturing back on shore. It would result in a massive investment boom in the US and the us government would likely print money and provide very low interest loans to fund it. Would result in massive jobs program. I think China would fall in that case as they are massively reliant on the US manufacturing everything there.
To whomever downvoted this comment: Half the worlds transactions are now conducted in currencies other than the US dollar. The world has cottoned to the idea that we are inflating their economies by printing dollars.
According to the US Treasury, the Chinese are not dumping bonds at all. [0] [1]
Side-note: The Chinese have to own treasuries because the US buys so much stuff from them. If they hurt the US currency relative to their own, then Chinese goods would become more expensive for Americans, and the US would buy less. That would not be good for an economy like China's that has a trade surplus with the US in the range of hundreds of billions of dollars per year. [2]
The vast majority of money that is created in modern credit-based economies is via bank loans, not central banks. Cullen Roche the very informative paper "Understanding the Modern Monetary System" ten years ago, and it's still relevant:
> In many market based systems such as the USA, the money supply is essentially privatized and controlled by private banks that compete to create loans which create deposits (money). Contrary to popular opinion, governments in such a system do not directly control the money supply nor do they create most of the money.
The US Dollar M1 money supply increased by 66.5% and M2 by 25.4% between Dec 2019 and Dec 2020 [0]. I'd give you more current data, but the Fed stopped reporting the overall changes and M2 in general in early 2021. The ostensible reasons for that depend on how tight your tinfoil hat is, but plenty of money is created by the Fed, and that number hit trillions in the last 18 months.
It's "only" up 31.76% since Fed 2020 / before they started messing around.
It was already regularly increasing by ~7% per year - so you'd expect close to a ~10% difference. So we've got about ~20% more M3 than you would otherwise expect.
If they're trying to cover up data, they're doing a bad job.
Thanks for the info. I had been referring to the Fed's weekly releases, which didn't include that. I went to look into why, and found "Since 2006, M3 is no longer tracked by the Federal Reserve. ... However, the Federal Reserve Bank of St. Louis and some other sources still publish M3 figures for economic data purposes"
Regardless, 7% is already ridiculous, and over 20% beyond that is absurd.
> […] but plenty of money is created by the Fed, and that number hit trillions in the last 18 months.
No: it, at most, creates bank reserve deposits:
> The story usually says that the Fed sets a quantity of reserves and banks then multiply those reserves into loans meaning that the Fed has a direct control over the quantity of money being created. But the financial crisis proved that this theoretical view is precisely backwards. In fact, banks make loans first and find reserves after the fact. In other words, the Fed accommodates the quantity of loans by supplying the necessary quantity of reserves. As a result, the money multiplier that we all learn in school is wrong and the Fed has no direct control over the quantity of loans/deposits issued meaning that the predominant form of money (deposits) is controlled almost entirely by private banks and not the Central Bank.
Just because the Fed reports on things like the various 'M' statistics does not mean that they have a large effect on them.
The private banking industry, through credit/loans, is where the majority of money is created. I direct you to Cullen Roche's paper "Understanding the Modern Monetary System", which is explains how things work in 2021, and not how they used to work in like 1921:
> In understanding inside money and outside money, one must also understand that it is the banks who “rule the monetary roost” so to say. That is, banks issue almost all of the money in circulation today in the form of loans and the government is designed primarily to support this privatized money creation source. Contrary to popular belief, the government does not issue or “print money” (except in the most literal sense, ie, the US Treasury prints notes to meet demand for use at private banks by bank customers who have accounts in inside money). The government is only the issuer of outside money which is designed to facilitate and support the use of inside money
But the government can almost literally print money and did this time.
If the government sends people stimulus checks, pays for that with deficit spending, and that debt is monetized by the Fed purchasing it...
You had money that did not exist, that the Fed created on its spreadsheet to buy Treasuries to finance the Federal government... Sending people checks, unemployment, and businesses paycheck protection.
AFAIK, this was >$2T of the Federal Reserve's ~$7T balance sheet increase (~30%).
In normal times, the Federal government deficit spends, but the Federal Reserve's balance sheet does not increase to finance that.
Although the deficit is not paid for by taxes, the money created is not coming from the Federal Reserve.
T bond yields are determined by auction, so the Fed does not have full discretion over long term interest rates. That's why the 30yr yield has fluctuated between 1.6-2.5% this year even though the overnight rate has not changed.
The Fed is a participant in that auction with a large ($80B/month) budget and a target interest rate of 0-0.25%, though. You don't have much of an incentive to bid low if you know the Fed is going to swoop in and buy the bonds anyway.
Everyone does this, I mean do you expect your 401(k) to have a return on investment? Do you feel guilty about your retirement funds taking money out of the system ?
I wonder if this is an artifact of how they are looking at the savings rate. If you think of someone wealthy like Bezos, he is rich on paper because the value of his shares of Amazon increased. This is not taking any liquidity out of the system. It's not "excess savings" because it's not income that is being saved.
Of course, he isn't typical of the top decile, but is typical of the most wealthy. I wonder if this is a bit like Piketty, where the driver was actually real estate appreciation. For the top decile, they are are still putting the most money into real estate, and the prices continue to be bid up. Real estate is where prices are most directly driven by interest rates that allow people to borrow ever more. So maybe their "excess savings" is just bidding up the price of housing.
Amazon's increasing share price would be a result of this though wouldn't it? Interest rates are low on savings accounts so the wealthy invest in the stock market driving up equity prices. So Bezos' paper wealth sky rockets because of the overall trend of the wealthy saving instead of spending.
I am sure there is a little bit of that, but only a few shares have to trade to push prices up. My point was that Bezos' wealth didn't come from his savings. It also doesn't match up with the argument that excessive savings are pushing interest rates down, because buying stocks doesn't push interest rates down. That's why I said something seems off in what they are counting as savings.
The article states:
"the savings of the American rich reappear, instead, as debt, owed by the government or by lower-income US households"
I really don't see how they are claiming this would work. The rich I know are not mainly buying consumer debt or treasuries- maybe the occasional tax free municipal bond. On the other hand, the Fed is buying tons of corporate bonds.
It seems a lot of handwaving is being done about a supposed 21.1% savings rate for top 10% in income. The claim is that they are using that to buy assets that reduce interest rates. I finally read the paper and see the definition of savings rate is very weird (to a non-expert). It could be completely explained by people in the top decile of income paying more for houses and having less debt on them.
> because buying stocks doesn't push interest rates down
But it does.
Either money can go into consumption goods, or it can go into investment goods. If it goes to investment goods, it does not go to consumption goods(this statement seems wrong to me, someone sold the stock and now has money, which they could spend on consumption, and yet seems to be true. Where is all this money going? Why does the M2V fall? If anybody can bring feedback on this I would appreciate it.) The Fed has an inflation target of 2%, and their main path to doing so is by balancing the creation of new money by changing the interest rate. When money is invested, inflation as tracked by PCE stays low. Therefore the Fed needs to drop interest rates further to hit their target.
Who can take out the new debt by lower rates? The people with the most creditworthiness. The rich. What do they do with that debt? Invest it. Who collectively creates the most debt? Companies creating bonds to buyback their own stock. The more wealth inequality there is, the more that money goes to investments, the less it effects consumption, the less of an effect changing interest rates has on inflation.
But it's a trap, as money can at any time flip from investment goods to consumption goods. On a dime these savers can choose to spend and suddenly we get way to much inflation. So the Fed has to ensure that investment goods always provide more long-term utility than consumption goods. But by investment goods out-competing, this only makes the problem worse. Wealth inequality grows further. They have to be even more sure that the wealthy choose investments. The Fed becomes even less able to move the inflation rate higher. Vicious cycle.
We've been going down this road for 50 years so far. Anytime the Effective Fed Rate has been above the 30 year[0], we get a yield curve inversion and soon run into a recession. I believe that's because anytime that the yield curve inverts, the wealthy work out that it is better for their money to be in consumption goods than investment goods, and thus they start DCA their funds out of the stock market, which causes a crash.
But take a second look at that chart. The 30 year keeps dropping. Will the 30 year hit 0? Will it go negative? If it does go negative, thanks to the yield curve recession hat would follow, does the Fed Rate need to go negative to follow it? It seems we've got about 10 years to answer these questions before it reaches 0. And remember, 15% rate -> 7.5% is the same difference as 4% to 2%, which is the same as 0.5% to 0.25% and 0.0005% to 0.00025%. We've got so many M2 doublings still ahead of us.
A lot of wealthyish people are borrowing against their portfolios to finance their lifestyles, under the old banker adage of borrow at 3%, invest at 10%...
This kind of lending used to be reserved for pretty wealthy people, and honestly never made much sense in the era of 8-10% interest rates. But now, interest rates are sub-inflationary and there are tons of companies out there willing to give low-interest loans to Joe Consumer. Almost anyone can get a 2% loan against a quarter of your portfolio from online investment firms.
At that point, you'd be crazy to liquidate your investments. Even if your investments did nothing, it would take years of interest payments just to exceed the capital gains tax on liquidating it.
Then there's the fact that most major purchase (housing, cars) can be readily financed at low interest rates without needing a huge investment portfolio.
We might be in a Too Big To Fail moment with interest rates. If they go up too much, a lot of leveraged people who've seen staggering returns might be forced to liquidate their holdings, driving down prices and triggering margin calls on people who are buy-and-hold types, causing a feedback loop.
There is a reason that is an old banker's adage. My response would be, why would you loan to me at 3 when you could invest at 10? The answer is risk. The banker knows how to calculate risk.
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.
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.
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.
As a millenial with a good chunk of his net worth in property, it seems clear that real estate prices are inflated by the Govt via mortgage rates, and I am super nervous about how this plays out now that they are near zero in conjunction with QE. Nowhere to go but down? Yikes
I've thought that the baby boom savings cycle explained most of it, but neat to see some numbers contesting that. But this paper seems to assume that US asset prices are determined entirely by domestic demand which seems wild in a world awash with sovereign wealth funds, pension plans, diversified savers, and emerging market wealth seeking a safe haven.
I see some work attributing pensions, etc. to demographic deciles, but ctrl-F "foreign" comes up 0.
Does anyone know of any estimates of what fraction of net inflow into US financial assets are domestic vs foreign?
43 comments
[ 3.4 ms ] story [ 29.1 ms ] threadIt'd be like arguing about why rents aren't going up in a rent controlled neighborhood. "Because there's excess housing and not enough renters" doesn't seem to really explain the process.
If you'd read just a tiny bit into macro economics (every intro textbook will work), it stops doing so.
I think the point of the FT article is that inequality is causing there to be a need for lower interest rates, which causes more inequality, which causes even lower interest rates, which...
Virtuous / vicious cycle, depending on which side you're on.
When the US prints money we steal from every person in the world who uses a Dollar backed currency. I’m not sure how much longer they will tolerate this. They’re already not buying our bonds…
The US will need to take out loans from the IMF, from China, from other nations in ASIA to buy e-yuan. China will pay us back in the dollars they have but will demand e-yuan for anything we want to buy from them. Now the Fed is enjoying its last hurrah. Printing money like its going out of style (which in fact it is) (Actually the Treasury prints the money but they wouldnt print unless the Fed issued bills and bonds to sell.)
When austerity hits home, the rich and privileged classes will have a new 'news bite' with which to beat the 'lazy unemployed'. Helicopter money will disappear. Austerity measures will include wage and price controls (like Nixon did in 1970s), sky high interest rates. And a booming underground economy as Americans learn to dodge taxes like the Greeks do. We will become like England. They were the host state to Arab oil money. We will see China buying up valuable parts of the US simply because we will have nothing else they want. Dont fool yourself, their weapons have reached parity withours. Their chip industry is at most 5 years behind ours. Their ML is at parity with 'ours' -facebook, google. OTOH, facebook and google might just move to china for the free-er capitalism they will have.
^This is my biggest concern.
Thus far real estate has been my favorite investment. I assume though if interest rates go up peoples buying power and hence prices will go down. If I liquidate my investments I will owe taxes and I fear inflation will eat up the cash value.
Buy e-yuan? Leave the USA?
Why can't the dollar be the same?
really? Given that US treasury bonds have some of the lowest yield, it means that it must be currently being bought up (which pushes yield down).
Bonds from countries like argentina have yields at around 47% - because nobody would buy them otherwise as they are hugely risky. See http://www.worldgovernmentbonds.com/country/argentina/
Our bonds are cheap because we can offload them onto the Fed.
Side-note: The Chinese have to own treasuries because the US buys so much stuff from them. If they hurt the US currency relative to their own, then Chinese goods would become more expensive for Americans, and the US would buy less. That would not be good for an economy like China's that has a trade surplus with the US in the range of hundreds of billions of dollars per year. [2]
[0] - https://ticdata.treasury.gov/Publish/mfh.txt
[1] - https://www.bloomberg.com/news/articles/2021-04-15/china-s-h...
[2] - https://ustr.gov/countries-regions/china-mongolia-taiwan/peo...
AFAICT:
* US federal debt held by Fed Reserve Banks: $5.6T
* US debt held by foreign and international investors: 7T
* Debt held by private private investors: 17T
See, which while having a "2018" URL, has an up-to-date embedded graph:
* https://fredblog.stlouisfed.org/2018/04/whos-buying-treasuri...
17+7+5.6=29.6. 5.6/29.6 = 19%.
> That number is increasing every year.
It was rising up to 2014, then held fairly steady between 2014 and 2018, and then started decreasing until the drama of 2020 kicked in:
* https://fred.stlouisfed.org/series/TREAST
The vast majority of money that is created in modern credit-based economies is via bank loans, not central banks. Cullen Roche the very informative paper "Understanding the Modern Monetary System" ten years ago, and it's still relevant:
> In many market based systems such as the USA, the money supply is essentially privatized and controlled by private banks that compete to create loans which create deposits (money). Contrary to popular opinion, governments in such a system do not directly control the money supply nor do they create most of the money.
* https://papers.ssrn.com/sol3/papers.cfm?abstract_id=1905625
* https://rationalreminder.ca/podcast/132
* https://www.youtube.com/watch?v=uZi4QE_EfCw
This is especially true in places where reserve requirement no longer exist, e.g., Canada got rid of them in the 1990s.
0: https://www.federalreserve.gov/releases/h6/20210128/
It's "only" up 31.76% since Fed 2020 / before they started messing around.
It was already regularly increasing by ~7% per year - so you'd expect close to a ~10% difference. So we've got about ~20% more M3 than you would otherwise expect.
If they're trying to cover up data, they're doing a bad job.
Regardless, 7% is already ridiculous, and over 20% beyond that is absurd.
Are you aware of the regulatory reporting change in regards to M1?
* https://fredblog.stlouisfed.org/2021/01/whats-behind-the-rec...
> […] but plenty of money is created by the Fed, and that number hit trillions in the last 18 months.
No: it, at most, creates bank reserve deposits:
> The story usually says that the Fed sets a quantity of reserves and banks then multiply those reserves into loans meaning that the Fed has a direct control over the quantity of money being created. But the financial crisis proved that this theoretical view is precisely backwards. In fact, banks make loans first and find reserves after the fact. In other words, the Fed accommodates the quantity of loans by supplying the necessary quantity of reserves. As a result, the money multiplier that we all learn in school is wrong and the Fed has no direct control over the quantity of loans/deposits issued meaning that the predominant form of money (deposits) is controlled almost entirely by private banks and not the Central Bank.
* https://www.pragcap.com/common-myths-about-the-federal-reser...
However, US reserve requirements were set to zero in March 2020, so banks could create loans more easily:
* https://www.federalreserve.gov/monetarypolicy/reservereq.htm
But there's nothing special about reserve requirements being zero: e.g., Canada has been at that level since 1992:
* https://en.wikipedia.org/wiki/Reserve_requirement#Canada
Just because the Fed reports on things like the various 'M' statistics does not mean that they have a large effect on them.
The private banking industry, through credit/loans, is where the majority of money is created. I direct you to Cullen Roche's paper "Understanding the Modern Monetary System", which is explains how things work in 2021, and not how they used to work in like 1921:
> In understanding inside money and outside money, one must also understand that it is the banks who “rule the monetary roost” so to say. That is, banks issue almost all of the money in circulation today in the form of loans and the government is designed primarily to support this privatized money creation source. Contrary to popular belief, the government does not issue or “print money” (except in the most literal sense, ie, the US Treasury prints notes to meet demand for use at private banks by bank customers who have accounts in inside money). The government is only the issuer of outside money which is designed to facilitate and support the use of inside money
* https://papers.ssrn.com/sol3/papers.cfm?abstract_id=1905625
A good interview with Roche on the Rational Reminder podcast from a few months ago:
* https://rationalreminder.ca/podcast/132
* https://www.youtube.com/watch?v=uZi4QE_EfCw
If the government sends people stimulus checks, pays for that with deficit spending, and that debt is monetized by the Fed purchasing it...
You had money that did not exist, that the Fed created on its spreadsheet to buy Treasuries to finance the Federal government... Sending people checks, unemployment, and businesses paycheck protection.
AFAIK, this was >$2T of the Federal Reserve's ~$7T balance sheet increase (~30%).
In normal times, the Federal government deficit spends, but the Federal Reserve's balance sheet does not increase to finance that.
Although the deficit is not paid for by taxes, the money created is not coming from the Federal Reserve.
In this case, almost all of it did.
The Fed buying $80B/month is less than 5% of what was issued.
Source: https://www.sifma.org/resources/research/us-treasury-securit...
And what do people do with those returns? They spend them! People don’t want to die with a huge 401(k).
Of course, he isn't typical of the top decile, but is typical of the most wealthy. I wonder if this is a bit like Piketty, where the driver was actually real estate appreciation. For the top decile, they are are still putting the most money into real estate, and the prices continue to be bid up. Real estate is where prices are most directly driven by interest rates that allow people to borrow ever more. So maybe their "excess savings" is just bidding up the price of housing.
The article states: "the savings of the American rich reappear, instead, as debt, owed by the government or by lower-income US households"
I really don't see how they are claiming this would work. The rich I know are not mainly buying consumer debt or treasuries- maybe the occasional tax free municipal bond. On the other hand, the Fed is buying tons of corporate bonds.
It seems a lot of handwaving is being done about a supposed 21.1% savings rate for top 10% in income. The claim is that they are using that to buy assets that reduce interest rates. I finally read the paper and see the definition of savings rate is very weird (to a non-expert). It could be completely explained by people in the top decile of income paying more for houses and having less debt on them.
But it does.
Either money can go into consumption goods, or it can go into investment goods. If it goes to investment goods, it does not go to consumption goods(this statement seems wrong to me, someone sold the stock and now has money, which they could spend on consumption, and yet seems to be true. Where is all this money going? Why does the M2V fall? If anybody can bring feedback on this I would appreciate it.) The Fed has an inflation target of 2%, and their main path to doing so is by balancing the creation of new money by changing the interest rate. When money is invested, inflation as tracked by PCE stays low. Therefore the Fed needs to drop interest rates further to hit their target.
Who can take out the new debt by lower rates? The people with the most creditworthiness. The rich. What do they do with that debt? Invest it. Who collectively creates the most debt? Companies creating bonds to buyback their own stock. The more wealth inequality there is, the more that money goes to investments, the less it effects consumption, the less of an effect changing interest rates has on inflation.
But it's a trap, as money can at any time flip from investment goods to consumption goods. On a dime these savers can choose to spend and suddenly we get way to much inflation. So the Fed has to ensure that investment goods always provide more long-term utility than consumption goods. But by investment goods out-competing, this only makes the problem worse. Wealth inequality grows further. They have to be even more sure that the wealthy choose investments. The Fed becomes even less able to move the inflation rate higher. Vicious cycle.
We've been going down this road for 50 years so far. Anytime the Effective Fed Rate has been above the 30 year[0], we get a yield curve inversion and soon run into a recession. I believe that's because anytime that the yield curve inverts, the wealthy work out that it is better for their money to be in consumption goods than investment goods, and thus they start DCA their funds out of the stock market, which causes a crash.
But take a second look at that chart. The 30 year keeps dropping. Will the 30 year hit 0? Will it go negative? If it does go negative, thanks to the yield curve recession hat would follow, does the Fed Rate need to go negative to follow it? It seems we've got about 10 years to answer these questions before it reaches 0. And remember, 15% rate -> 7.5% is the same difference as 4% to 2%, which is the same as 0.5% to 0.25% and 0.0005% to 0.00025%. We've got so many M2 doublings still ahead of us.
[0]: https://fred.stlouisfed.org/graph/?g=ENDs
This kind of lending used to be reserved for pretty wealthy people, and honestly never made much sense in the era of 8-10% interest rates. But now, interest rates are sub-inflationary and there are tons of companies out there willing to give low-interest loans to Joe Consumer. Almost anyone can get a 2% loan against a quarter of your portfolio from online investment firms.
At that point, you'd be crazy to liquidate your investments. Even if your investments did nothing, it would take years of interest payments just to exceed the capital gains tax on liquidating it.
Then there's the fact that most major purchase (housing, cars) can be readily financed at low interest rates without needing a huge investment portfolio.
We might be in a Too Big To Fail moment with interest rates. If they go up too much, a lot of leveraged people who've seen staggering returns might be forced to liquidate their holdings, driving down prices and triggering margin calls on people who are buy-and-hold types, causing a feedback loop.
There is a reason that is an old banker's adage. My response would be, why would you loan to me at 3 when you could invest at 10? The answer is risk. The banker knows how to calculate risk.
Banks are constrained in this regard. Money earmarked for lending cannot instead be invested by the bank.
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.
I see some work attributing pensions, etc. to demographic deciles, but ctrl-F "foreign" comes up 0.
Does anyone know of any estimates of what fraction of net inflow into US financial assets are domestic vs foreign?