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Wages have been stagnant for 30 years. Declining in many key industries actually. Lower workforce participation rate, larger class of takers....
This ship wouldn't float without all the handouts, both to the welfare class, and the elite welfare class. Just saying, mediocrity should not be celebrated.
I can see where we are going, and where we will end up when I am your age. That's why I have every right to be concerned. You have your precious investments to worry about. That much, I can understand.
Last edited by yellowbelle; 02-18-2016 at 01:34 PM..
Reason: quoted post has been deleted
Interesting commentary from California State Assemblyman Mike Gatto, regarding QE benefiting banks. Whether it has benefited the economy in general is something else entirely...
Under QE, the Fed creates new money. In our example, it will create $98 million, to buy this bond. By doing so, the interest rate has decreased to approximately 2 percent. And the bank made an easy profit, risk-free, on top of any commissions. But if the bank fails to lend out those funds, it does little for the economy.
You might ask yourself why the quasi-governmental Federal Reserve doesn’t just buy bonds directly from the Treasury. “No,” they say, “that would be too close to just printing money for the government.” As if using a middleman and generating private profits makes the process significantly more palatable.
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Now that we’ve established that QE has profited banks, you might ask what it has done for the overall economy. Recently, certain economists have raised the possibility that it might have actually hurt it. Recall that conventional economics is often bad at predicting outcomes, like the extent that government spending (a theoretical stimulus) can “crowd out” private spending (and thus paradoxically hurt the economy) – or how the S&P downgrade of the United States’ credit rating in August 2011 counterintuitively caused U.S. borrowing costs to decrease.
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At any rate (pun intended), Americans are right to question whether the Fed’s actions have had the intended results, whether they’ve benefited anyone besides banks, and whether the Fed is experimenting with the economy at a time where everything feels pretty fragile. Let’s hope the presidential field understands these concepts and lets us know where they stand sometime soon.