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RE: The first earns it, the second enjoys it and the third destroys it
sounds like you’re equating compouding in productive businesses with interest on sovereign debt, but those are different engines. Central banks set policy rates to manage inflation and employment, not to cap long run equity cash flows and and reinvested dividends. Private returns can outpace noise for decades even while the state keeps debt stable when growth runs at or above funding costs. Are you saying a persistent equity risk premium cannot exist by design?
0.00000323 BEE
Yes that's exactly what I am doing as the interest rate set by the central bank directly affects the rates the banks set.
An equity risk premium relates to the risks of investing in the stock market compred to government bonds or the rates offered by the banks. ie. You are now presenting a case for why you should invest in stocks (equity) rather than simple compounding interest. https://www.investopedia.com/terms/e/equityriskpremium.asp