*Notes on inequality and growth

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Here is Joe Weisenthal

Why is the economy so weak? It's simple: Inequality. Income gains for the 95% have been meager for a long time, but up until the crisis, households could take on debt to compensate. Now credit has harder to come by, and so their buying power is limited.

Marie Schofield, Chief Economist and Toby Nangle, Head of Multi asset Allocation at Columbia Management have a great little note up reminding people of the basic force that's holding back the economy.

For decades, the top 5% have been accumulating an ever-increasing share of the national income in the US:

Columbia Management

The remaining 95% were only able to keep their buying power up by taking on more debt.

Lately that hasn't been an option.

Read more: http://www.businessinsider.com/inequality-and-the-weak-recovery-2014-3#ixzz2v62EM1Cw

This is the exact same mechanism we pointed out a few years back, in fact not just for the slow recovery but as a partial explanation for the economic crisis..