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The New War On The Poor and Middle Class

September 19, 2012

The New War On The Poor and 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.” $5/gallon gas might indeed happen soon, along with $5/gallon milk. Who knows where bread, eggs, coffee, and other staples will go? Will wages rise along with the cost of living? For some they might. For many they will not. Those who will see thier relative wages decline are people are likely to be the poorest in society already, and I’m not just talking about people in the United States who at least for the time being have access to food stamps. Read More… on Against Crony Capitalism

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