Imagine… if you could press a magic button… and your wealth expanded by hundreds of thousands…if not millions of Dollars.
Imagine the power you’d feel… not to mention the financial security… knowing that at any point, if things get shaky with your investment portfolio, you could simply hit that button (or sometimes just promise to hit that button to the world) and you become richer virtually overnight.
For most people this is nothing more than a pipe dream. For the officials at the Federal Reserve, it’s a reality.
As everyone now knows… the Fed’s monetary policies are directly aimed at pushing the stock market higher. After all, the Fed’s own research shows QE to be a complete failure at generating jobs or GDP growth. And if you divide the NYSE by the Fed’s balance sheet, you get a straight line, showing that all stock gains are directly correlated to the Fed’s balance sheet expansion.
Lost amidst the pages of research written about this is the fact that Janet Yellen and most officials have profited personally from this.
Indeed, since 2011, Yellen’s net worth has risen somewhere between $900,000 and $1.7 million.
And the bulk of the money she made came from her investments in stocks.
1. In 2011, Yellen between $4.4 million and $12.4 million in assets (her financial disclosures are presented in a range).
2. As of 2012, Yellen had between $4.8 and $13.2 million in assets.
3. By 2013, Yellen’s had between $5.3 million and $14.1 million in assets.
It’s extraordinary, really. Can you imagine how Yellen must feel having made over a million dollars from her investments… investments which directly profited from her decisions as Fed Vice-Chair (2010-2014) and Chair (early 2014 to the present)?
Yellen is not alone by any stretch. Most Fed Presidents (the very folks who vote on whether or not the Fed should engage in more money printing…and who also decide to appear on TV or give speeches talking about engaging in more money printing) have profited handsomely from the stock market rising.
The rest of America… not so much. According to data from the Federal Reserve, only 13.8% of US families own individual stocks. Granted that’s individual stocks… but even if you include 401Ks and other stock-based retirement plans through which Americans have indirect exposure to stocks, you’re still talking about less than half of the US (48%) profiting from the Fed-fueled market rally.
So… QE has failed to boost employment, failed to create sustainable job growth, and has benefitted less than half of Americans even by the most liberal estimates possible… just why did the Fed spend over $3.5 trillion again?
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