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Fed's new policies favor rich


VABills

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http://money.cnn.com/2012/09/20/news/economy/federal-reserve-rich/index.html?hpt=hp_t1

 

According to the Fed helping the rich will trickle down and help the middle class get jobs. Say it isn't so. After 4 years of how we have to help the middle class by taking from the rich, they now decide you have to help the rich in order to help everyone else.

 

Who'd have thunk it.

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It appears that maybe you don't know/understand who and what the Fed is?

 

Federal reserve is a "independant entity" that doesn't have to take monetary policy from the preseident, although they are appointed by the president. 12 member banks from regions around the country make up the reserve board, but policy is set by the director, a political appointee.

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"Quantitative easing is a blunt tool and cannot really target specific areas of the economy, aside from mortgage rates. Even then, it tends to help the wealthy spectrum of the income distribution," said Sung Won Sohn, economics professor at Cal State Channel Islands.

 

Cal State Channel Islands?? :w00t:

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One could make the argument that since 50% of our country lives paycheck to paycheck & hence have little wealth other than home equity & minimal retirement accounts that The Feds policies do more to help them than the rich.

 

Since the Republicans have blocked taxing the rich to redistribute via govt investment the next solution is inflation. Since all the Fed is doing right now is preventing deflation, they are hoping to re-inflate our bubble economy.

 

If you look at high net worth they've been investing in art, real estate investment, commodities to hedge against inflation. The Dow is back near all-time highs thanks to 3 rounds of QE (inflationary by nature). The Dow has been artificially inflated by easy money flooding the market. IE- banks can borrow at zero and make gambles on the market, foreigners want in, and the higher gains attract those of middle class.

 

With 10 year Treasuries near 0%, high worth investors can either allow inflation to eat away at their principle or park their money in conservative dividend yielding stock as the t-bills and corporate bond market is unattractive thanks to deliberate Fed policies of low interest rates & QE.

 

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One could make the argument that since 50% of our country lives paycheck to paycheck & hence have little wealth other than home equity & minimal retirement accounts that The Feds policies do more to help them than the rich.

 

Since the Republicans have blocked taxing the rich to redistribute via govt investment the next solution is inflation. Since all the Fed is doing right now is preventing deflation, they are hoping to re-inflate our bubble economy.

 

If you look at high net worth they've been investing in art, real estate investment, commodities to hedge against inflation. The Dow is back near all-time highs thanks to 3 rounds of QE (inflationary by nature). The Dow has been artificially inflated by easy money flooding the market. IE- banks can borrow at zero and make gambles on the market, foreigners want in, and the higher gains attract those of middle class.

 

With 10 year Treasuries near 0%, high worth investors can either allow inflation to eat away at their principle or park their money in conservative dividend yielding stock as the t-bills and corporate bond market is unattractive thanks to deliberate Fed policies of low interest rates & QE.

This is quite a contradiction. 1. The bottom 50% own no assets, so fed policy helps them most. 2. Fed policy has boosted stock prices. Hmmm....explain please.

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This is quite a contradiction. 1. The bottom 50% own no assets, so fed policy helps them most. 2. Fed policy has boosted stock prices. Hmmm....explain please.

 

I wonder how he feels about savers that are seeing their wealth eroded by inflation from commodity prices and getting negative returns on their guaranteed savings that don't have the stomach to go through this roller coaster the volatility is generating.

 

This is the level of understanding from the Obama electorate.

Edited by meazza
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This is quite a contradiction. 1. The bottom 50% own no assets, so fed policy helps them most. 2. Fed policy has boosted stock prices. Hmmm....explain please.

I wonder how he feels about savers that are seeing their wealth eroded by inflation from commodity prices and getting negative returns on their guaranteed savings that don't have the stomach to go through this roller coaster the volatility is generating.

 

This is the level of understanding from the Obama electorate.

No, you got it wrong. You see, Barry is doing something! nevermind that it won't help hte intended target, if not make things worse

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This is quite a contradiction. 1. The bottom 50% own no assets, so fed policy helps them most. 2. Fed policy has boosted stock prices. Hmmm....explain please.

 

1. the bottom 50% certainly do have assets, problem is much of it was tied to real estate. Hence Bernake is trying to re-inflate the housing bubble with out letting it get out of control. The Fed keeping interest rates low will help the recovery short term & long term inflation will help increase the price of their home which will increase their equity position. 2. stock prices are directly correlated to the currency they are traded in. If the US Dollar deflates versus world currency foreign investment will increase as our stocks priced in USD will be a more attractive investment. Once businesses see their stock prices rise they will be inclined to hire. Finally the Fed taking bad debt off the banks balance sheets should free up banks to borrow money from the treasury and loan it to small businesses which are the growth engine of our economy.

 

Listen, I would rather see Bernake try a different approach. I for one like economist Steve Keen's idea of a modern debt jubilee or what he has coined "Quantitative Easing for the Public". If you have 27 minutes you could learn a lot. http://www.youtube.com/watch?v=4sSfPkIUHPk

 

I wonder how he feels about savers that are seeing their wealth eroded by inflation from commodity prices and getting negative returns on their guaranteed savings that don't have the stomach to go through this roller coaster the volatility is generating.

 

This is the level of understanding from the Obama electorate.

 

The savers who bought mortgage backed securities via pension funds, individual investment, that was Triple A rated by Standard & Poors thought they were in a "safe" investment. Be careful putting all of your eggs in one basket.

Edited by BiggieScooby
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Where's your link? Thats what you ask everyone else isn't it?

 

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Tim Pawlenty quit as co-chair of Mitt Romney's presidential campaign on Thursday to become one of Wall Street's top lobbyists in Washington. Pawlenty, a former governor of Minnesota, will lead the Financial Services Roundtable.

 

The move came with Romney's campaign struggling to find its stride with just seven weeks left before Election Day.

 

46 days left and the rats are jumping ship.

Edited by BillsFan-4-Ever
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Where's your link? Thats what you ask everyone else isn't it?

 

----------------------------

 

Tim Pawlenty quit as co-chair of Mitt Romney's presidential campaign on Thursday to become one of Wall Street's top lobbyists in Washington. Pawlenty, a former governor of Minnesota, will lead the Financial Services Roundtable.

 

The move came with Romney's campaign struggling to find its stride with just seven weeks left before Election Day.

 

46 days left and the rats are jumping ship.

 

Again, you should direct your comments to a specific individual if you are in fact wanting to get their attention. Quote them or name them. It's hard enough to understand the content of your posts without you at least giving them a direction.

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