Chris Martenson, an economic researcher and co-founder of financial advisory website PeakProsperity.com, wasn't too impressed with Federal Reserve Chair Janet Yellen's expression of concern last week about the increase in income inequality.
"I found her speech to be disingenuous and disturbing. Why? Because it is the Fed's very own policies that are driving the expansion of the wealth gap," he writes in an article for MarketWatch
"Either Yellen thinks we cannot be trusted with the truth (worrisome), or the Fed is clueless as to how its own policies operate (scarier)."
The problem is the Fed's low interest-rate policy, Martenson says. The Fed has kept its federal funds rate target at a record low of zero to 0.25 percent since December 2008.
"The academic name for the Fed's current policy is financial repression," he writes. "But a more apt name would be 'Throw granny under the bus,' because the program boils down to taking from savers and fixed-income recipients and transferring that purchasing power to other entities."
It is generally the less-wealthy who are dependent on fixed income for living expenses.
"That the Fed is feigning ignorance speaks volumes about how ignorant they believe we all are. This is a sure sign that we are trapped in a dysfunctional relationship with an abusive partner," Martenson explains.
"According to Yellen, if people are finding themselves getting poorer what they need to do is stop scrimping on their kids, become an entrepreneur and go back in time and have rich parents somehow. This statement of hers calls for pitchforks and torches. Without a shred of decency, she has shifted all blame from the Fed to the victims," he adds.
"If the Fed were an individual, we'd call its behavior pathological. Psychopaths blame their victims."
Doug Kass, president of hedge fund manager Seabreeze Partners Management, believes the Fed won't raise rates for a long time.
"I think we're approaching an 'aha' moment, when investors realize that growth isn't going to emerge in the months ahead," he tells The New York Times
"People are losing sight of the fact that the Fed hasn't raised rates since June 2006. I don't see them raising rates for two or three more years. That will be another surprise for the markets."
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