Jim Hightower | The Fed’s Wizardry Isn’t Doing Much for the Rest of Us

[eridani]

http://www.nationofchange.org/fed-s-wizardry-isn-t-doing-much-rest-us-1381672133

For five years, America’s central bank has funneled two massive subsidies into Wall Street banks and giant corporations in an ungodly effort to keep them flush, while praying that they might use these government windfalls to create a job or two.

The first subsidy essentially amounts to giving $85 billion every month to big banks. Yes, 85 billion! The idea behind the government’s so-called “asset-purchase program” is that this capital will be channeled into investments that nourish the roots of our economy.

In practice, however, bankers are funneling this cash into gimmicky high-risk investment schemes that create nothing and buyouts to expand their already too-big-to-fail empires — plus ever-heftier paychecks for themselves.

The second subsidy is the Fed’s relentless policy of artificially holding interest rates close to zero. This has severely punished middle-class retirees who counted on getting interest income from their savings, but it’s been a blessing from on high for huge corporations wanting to buy out their competitors or — in a totally unproductive bit of marketplace voodoo — to buy out themselves.

[Laelth]

1. k&r for the truth. n/t

-Laelth

[SlipperySlope]

2. I don't think they were intended to do much for the rest of us.

The very mechanism of QE dictates that banks benefit the most.

[Scuba]

3. Kick for the sad truth.