The result is a marked loss in people’s purchasing power and a decline in the labour share of income, which is the share of total income paid to workers as wages, salaries and other benefits. Today I want to make four conceptual points about these developments.
Having just recently given an entire speech on the subject, I will note here only that both the LCR and the NSFR – along with the Federal Reserve’s annual Comprehensive Liquidity Assessment and Review – were motivated by the systemic liquidity squeeze experienced during the crisis.