[fiachamp]

That share of income from wages started its downward trajectory in 1971, when the US removed the gold standard and money-printing replaced hard money. The result was a man-manipulated interest rate fueled economy. Low interest rates benefit existing asset holders the most since they most definitively increase asset prices. Think about the simplest discounted cashflow, a perpetuity. When you change the discount rate r from 4% to 1%, the perpetuity value increases by 4x.

[genewitch]

I've heard the gold theory a lot, but my current best theory is it wasn't until credit cards became ubiquitous that wages stagnated and the debt treadmill began. There was also a significant population increase in the latter half of the century, there - but forget looking at milk prices or gasoline prices - look at a ford mustang, or a motorhome - or even housing.

Once a certain segment of the population realized that real estate was "undervalued" relative to the potential for collecting rent on the undervalued property - yeah. rent goes up, wages don't at the same rate, more credit card debt. High debt means you're paying nearly all interest, so that ain't going down.

Oh and does anyone actually remember earning a decent amount of interest at a bank? man, those were the days. 12 month 7% CDs, lol.