Why Uber and Apple Won’t Save The Economy
John Battelle

One of the elements rarely if ever mentioned in analysis of the economy is the negative effect of low (virtually 0%) interest rates on the millions of people who had planned to earn interest on their savings as a major part of a secure retirement. While popular wisdom is that raising rates would tank the economy because the recovery is “too fragile” has anyone done the math on how much more the economy would be boosted if people were earning a safe 5–6% on their savings?

Many people lost big in the first market crashes of the last 20 years. If they have recouped in time for retirement (or in time for being laid off for the crime if being 55 years old or older) they are unlikely to want to risk a nest egg of a few hundred k in the stock market. Many of the involuntarily under and unemployed could avoid selling their homes, taking punishingly low social security payments, or going through all their assets if old-fashioned interest could buffer risk. I would love to see someone like this writer or his interviewee look at this question in depth. How would the pluses of higher interest rates and higher income on savings balance the minuses of the higher cost of debt? How does the financialization of the economy play into this?

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