Listen up y'all, I got a story to tell
About the real rate, what it is and why it changes well
It's a compensation, a payment to delay
Consuming now, saving or investing today
Expectations and uncertainty of future
Affect the real rate, that's the feature
Good future, more consumption, real rate's high
Bad future, less consumption, real rate's shy
Wealth and income levels, they play a role too
The wealthy invest more in risk, the real rate may ensue
As income rises, investment in safe assets decline
Rates go up, bonds get sold, it's a financial decline
Business cycle, GDP growth and volatility
These factors affect the real rate, it's all relative, see
Economic expansion, consumer spending, rates go up
Recession, consumer saving, rates go down, oh what's up
So there you have it, the real rate story
Expectations, wealth, income and business cycle all play a part, oh gory!