How will households react?

Households, particularly low-income ones (we look at the United States, the euro zone and France), are currently “under attack” on several fronts: Sharply rising energy prices; Sharply rising food prices; Sharply rising real estate prices; Interest rates that are significantly lower than inflation; Rising car prices. The question is how households will react to these negative shocks. We can imagine: Demands for sharp wage increases and for wages to be indexed to prices; Demands for large government support; An increase in risky savings not invested in bonds; A search for innovative solutions (car sharing instead of ownership, alternative energy sources); Migration to small towns. However, it is important to understand that the situation of low-income households will deteriorate sharply , regardless of how they respond .