The Fed Declares War (on the poor, retirees, and the middle class)


food-bread-300x198 The Fed Declares War (on the poor, retirees, and the middle class)

In the attached article at Seeking Alpha Monty Agarwal correctly explains that the Fed’s all out effort to generate inflation (though the Bernanke doesn’t quite put it like that) will hurt everyday people.

Marc Faber said the same thing in an interview on Friday. The open ended QE of the Fed anounced on Thursday, coupled with the new efforts of the ECB anounced the week before that, combined with a likely future move by the Bank of China will benefit the rich (in relative terms to their more impoverished brethren,) while hammering the poor and middle class.
Old prudent middle class people who saved their entire lives used to live off of CD yields. Now? No chance Lance.

Agarwal also predicts that the actions of the Fed (and the ECB) will induce money currently on the sidelines into the game, which will move markets and prices for commodities, up.

(From Seeking Alpha)

“This new move by the Fed is unleashing massive amounts of money into the risk assets. Markets will now believe that, between the ECB and the Fed, all tail risks to the markets have gone.

In other words, this could mean that all the money that was hiding in the safety of U.S. Treasuries will now leave the Treasury markets and flow into equities and commodities.