

Monetary policy, interest rates, asset inflation, and stagflation all are directly linked. The Fed isn’t alone in causing this disconnect, which I acknowledged by noting previous administration policy, but the interest rates and quantitative easing have always been very related to asset inflation and wealth inequality and have been a direct target of the Fed. There’s a reason why Trump wants them to reduce interest rates further so badly despite the fact that since Volker even the Fed itself says that worsens stagflation. I directly dispute the models that say this stuff is benign or helpful because if anything rising income inequality is one of the biggest predictors for extreme economic depressions. And frankly it’s not just the Fed that’s doing this shit. It’s the whole Western liberal economic system.
Well the people who’s primary income that comes from their labor sees their wages stay the same while the rising assets take more of their income in the form of rents or the cost to actually buy things like property. That is until they can’t afford to buy necessities at all and completely abandon that economy. Those pressures exist both on individuals and new productive enterprises.