The notion of a two-track economy seems to be taking hold. We kicked the concept around pretty well last week — your 130 comments (as of this morning) helped clarify a great deal of what we know, don’t know, and need to worry about. The two-track concept overlaps with, and builds on, long-standing issues of inequality in the U.S., but it’s also different. Within existing income classes, some people find themselves in relatively good shape and others are completely hammered.
New dimensions of differentiation are also taking hold within occupations and within industries – the WSJ this morning has nice illustrations. The contours of this differentiation begin to shape our recovery or, if you prefer, who recovers and who does not – it’s hard to say how this will play out in conventional aggregate statistics, but these are likely to become increasingly misleading.
For now, I would highlight three points about the two-track future for banks – partly because this matters politically, and partly of the way it impacts the rest of the process. Continue reading “More On The Two-Track Economy — From The WSJ And Others”