Branches of K-Shaped Economy Diverging Even Wider: Clarida

Summary

Richard Clarida discusses the K-shaped US economy, explaining that the divergence between asset-owning households and those without stocks or homes has widened over the past six to seven years. He offers no actionable trading calls but provides a macro framework describing the economic split.

• Clarida endorses the K-shaped economy view, saying it has existed for some time
• The two branches have diverged further over the last 6-7 years
• Roughly 60% of Americans live in owner-occupied housing and most own stocks
• About 40% rent and do not hold much in equities
• Rising stock and house prices have benefited the top of the K
• Those in the lower branch, living paycheck to paycheck, have had a tough six years