The Purchasing Power of The People (for Americans, US Dollars) is being burned for the sake of Wall Street and The Election. For those of you who aren't paid to be willfully blind, this is how it works:
US GDP Slows -> Yellen Burns The US Dollar -> Gas Prices Rise
Now, that might be good for propping up the stock market (U.S. Dollar index -0.88 correlation to S&P 500) but it's not good for the purchasing power of everyday Americans. In effect, if Yellen can't keep Oil Up (Dollar Down), she can't keep the stock market up - screw The People.
It's not a partisan issue either. Remember Ronald Reagan and Bill Clinton? Republican and Democrat? #StrongDollar, Strong America?
That’s what all Americans (not just the 1% of us “making money” on Wall St.) had in the 1980s and 1990s. That’s what allowed their purchasing power to manifest into everything that was not US Dollar Devaluation by the Federal Reserve. That was awesome.
Every time the GDP cycle slows (and profit growth slows in conjunction with that), what do both Republicans and Democrats (Bush and Obama Administrations) beg for? Same thing Nixon and Carter did => Down Dollar, Bailouts, Inflations/Reflations, etc.
That’s not an American Standard anyone in this profession should be proud of. That’s the “Inequality” standard. And, until a legitimate leader figures this out, we’re heading down history’s littered path of failed monetary policies. Sadly, if an un-elected Fed is allowed to devalue the Dollar into the US election… rising gas, rent, and food prices will most definitely be the struggle for both the American People and their economy.
You see, inasmuch as Down Dollar asset “reflation” is a windfall for us “rich people,” it’s a passive aggressive consumption tax on the rest of the country (who these politicians patronize as “folks”).
As Senior Macro analyst Darius Dale pointed out recently (see chart below), the Fed's massive monetary policy experiment to reflate asset prices was undoubtedly pocketed by the wealthiest (top 10%) of Americans. Meanwhile, Bernanke eroded the purchasing power of every working class Americans to 40 year lows.
In other words, Fed policies paid the few ... and crushed the many.
Maybe one of these big time “for The People” candidates should figure this out. For people with non-partisan standards, it’s really not that complicated. So while everyone on Wall Street is begging for Yellen to devalue the U.S. Dollar, I can draw only one conclusion and it looks like this:
Sadly, Old Wall has always found novel ways to line its pockets.
How much longer will working class Americans stand for it?