Meanwhile, the “too big to fail” banks remain bigger and more powerful than ever while the richest Americans enjoy the gains of a hyper-charged financial system. Middle-class Americans seem stuck in a stage of permanent stagnation, with wage gains wiped out by high prices even as they remain buried under credit card debt, car loan debt, and student debt.
Which brings us to now: Ten years on, the gap between the rich and poor has grown dramatically, inflation is raging, and the stock market is driven by boom, busts, and bailouts. That’s what it did when COVID hit, printing 300 years’ worth of money in a few short months. The Fed tried several times, only to see the market start to crash, at which point the Fed turned the money spigot back on. Once it printed all that money, there was no way to withdraw it from circulation. But the Fed proceeded anyway…and then found itself trapped. Leaders at the Fed knew that they were undertaking a bold experiment that would produce few real jobs, with long-term risks that were hard to measure. In just a few short years, the Fed more than quadrupled the money supply with one goal: to encourage banks and other investors to extend more risky debt. It all started on November 3, 2010, when the Fed began a radical intervention called quantitative easing.
When the economy imploded in 2008, the Fed got credit for rescuing us.īut here, for the first time, is the inside story of how the Fed has reshaped the American economy for the worse. When the economy grew, it was credited to the Fed.
For most of its history, the Fed has enjoyed the fawning adoration of the press. If you asked most people what forces led to today’s unprecedented income inequality and financial crashes, no one would say the Federal Reserve. The New York Times bestseller from business journalist Christopher Leonard infiltrates one of America’s most mysterious institutions-the Federal Reserve-to show how its policies spearheaded by Chairman Jerome Powell over the past ten years have accelerated income inequality and put our country’s economic stability at risk.
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