I've downloaded the book to my iPad, but I've not read it yet. It's a very interesting historical hypothesis. From what I know of it, those fundamentals are the question. If the return on capital is historically persistently above the rate of growth of earnings, then you have what we would call a long-term wedge between those things, or disequilibrium, and it would mean this persistence, or perhaps even growth, in inequality. That's the conclusion he draws.
Our own belief, in the models we use, has a convergence of those things. That's why we talk about how the real long-term interest rate will be lower as those demographics come down. It's a hypothesis I need to understand better. It certainly would have very little to do with monetary policy. In monetary policy we believe we make a contribution here by keeping inflation low and stable, and that's the one thing we can do to allow people to make the right decisions.