The most recent cycle of globalization that kicked off in the 70s was a significant driver of income inequality, as US labor was forced to compete with millions of low wage workers from Eastern Europe and China. This dramatically shifted power from labor to capital. {chart} Labor lost its bargaining power. Real wages declined, and inflation trended lower on a secular basis, allowing interest rates to also move lower over multiple decades. Lower interest rates meant lower debt servicing costs. This meant more capacity for expanding credit, driving a Long-term Debt Cycle, not just in the US but in many other parts of ... (full story)