Oops! Philly Fed Admits QE widens inequality

from Not Quant

Once again, the Federal Reserve proves that it’s the last one to know everything that we knew already.   Today’s stunning announcement:  The Philadelphia Fed admits they (“may have”) made the wealthy wealthier and Main Street poorer.

Oops.  Sorry America.


The Philly Fed insists that “redistributing wealth” to the wealthy isn’t the main idea, but just a potential side effect of stimulus that they can’t do much about.

“Monetary policy currently implemented by the Federal Reserve and other major central banks is not intended to benefit one segment of the population at the expense of another by redistributing income and wealth,” …

“However, it is probably impossible to avoid the redistributive consequences of monetary policy”.

We’re shocked.  Shocked, we tell you.  It turns out that handing out free money,  buying worthless assets at face value and allowing a small cabal of private banks the sole right to access your magic free-money window, “may” have given some financial advantages to “one segment of the population”.   But that’s just a side effect of saving the “economy”.

Of course, it’s not just the bankers.  The 1% also happen to hold vastly more financial assets than the lower 99% — so they may directly benefit from financial asset-inflating monetary policy.

[read more here]

One Response

  1. Biggest move of my life, figuring out how to follow the bankers to the pay window but also make the extraction on the backs of the dividend receivers. That was long enough ago that I am now hoovering over the drain again. Knowing in your heart it is a rigged game, makes a maudlin finish to the game seem respectable. Anybody got a job for a hack letter writer, will work for peanuts. Oh ya, can not get into the States with out large envelope of cash to work out past transgressions with. The above witnesses my entirely suspicious sense of humour.

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