Key to K-shaped recovery… So polarization is

Key to K-shaped recovery… So polarization is what we’re talking about. We’re seeing in the U.S., where the value of assets goes up even more, and the value of assets goes up even more, and people who don’t have assets gets more difficult. One side is too cold, the other side is too hot. So where should the central bank target? Whether to target the upper income bracket and raise interest rates to curb the asset price bubble that they create, or the inflation that their solid consumption creates. Or cut interest rates to support the lower income bracket… And you’re going to have to think about it. We have the answer. Yes, the answer is a rate cut. And as you can see from the fact that we’re thinking about whether or not to cut interest rates this December, the central bank is going to have to do an uncomfortable rate cut in this situation. And then it’s not going to be able to cut interest rates enough to support the collapse of actual growth. And as I’ve always said in the interest rate view, we’re going to have to cut rates later than the market wants us to do. And by the way, for the high-income bracket, the current interest rate is not too much of a burden… So we continue to benefit from the interest rate cuts that are going on to support the lower end of the letter k. On the monetary policy side, low-income people benefit from monetary easing, but… You don’t get as much as you need… as much as you want… but on the other hand, you benefit from more rate cuts at the top of the k-shape… That’s what happens.

Monetary policy has an inherent limitation of not being able to use discriminatory policies. Rich people raise interest rates… Low-income families lower interest rates… It’s not possible. We have to raise the interest rate, we have to lower the interest rate, but we have to lower the interest rate. On the contrary, fiscal policy can support differentially. We can spend more on welfare for low-income people. Food stamps in the U.S. are a case in point. But then the shutdown… And that’s a fatal reason, which could lead to mass unemployment of government employees at a time when there are growing concerns about unemployment… When low-income families are struggling with high prices, high interest rates, and rising unemployment rates… Things where food stamps stop or health insurance stops… These news will be deadly.

The role of finance becomes important. He’s right… The problem is that even such countries are now short of money. The debt of countries around the world has increased significantly due to COVID-19. For example, the UK is now considering a tax increase. France also talked about a tax increase for the rich… We’re having a hard time going back and forth. If the government doesn’t have money… Can you support the bottom of the k-shape? The government has almost no silver bullet left. So we’re not going to shoot in bulk at this point, but we’re going to have to hit it almost with precision, right? We’re going to spend our money… It’s important to create stability in society, but isn’t it important to spend money where something is productive? That’s not so much a rapid increase in welfare for the bottom of the K-shape as government support for growing industries like AI… And that’s the point. And for your information, is AI the lower end of the K-shape? Is it the upper end? Yes, it’s the upper end. And the government’s finances… If it’s not enough… Efficient use is the key, so the focus will be on creating growth, and monetary policy, fiscal policy, and so on… It’s not enough for the lower part of the letter K… The upper part of the letter K is helpful… No… I don’t know if this is right for the situation. T.T) Wouldn’t that be the way it works?

Then, as time goes by, polarization increases… It means that the upper end of the K-shape will drive the economy more. Then, if the upper end of the K-shape becomes sluggish… What will happen? A rapid slowdown in growth could become a reality… Then shouldn’t there be another stimulus package? If the top of the K-shape is to continue to drive consumption growth… We’re going to need endless increases in the price of assets that are the source of these incomes, when it’s shaking… In an instant, concerns about a slowdown can grow. Isn’t that why they’re clamoring for a balance sheet expansion now?

Maybe the issue of entrenchment doesn’t start with inflation. Maybe we should start with polarization. I should write about the market. I should write about the market. If I write less, I think it’ll be a squeeze. T.T I’ll cut it down here. I’ll continue the rest tomorrow or the weekend essay. Thank you.