[Cheerio]

That description is probably not as generous as it could be, but if you read Bernanke’s post it’s pretty close.

First of all, the whole "smoothing out of the busines cycle" bit is pure fiction. If anything, attempts to centrally plan the economy are leading to greater and greater boom and bust cycles. Furthermore, denying that QE has exacerbated income inequality is to assert that somehow, inflating the value of a certain set of assets doesn’t by definition widen the gap between the accumulated wealth of the people holding those assets and the people who don’t hold those assets. The St. Louis Fed seems to understand this (incidentally, they also understand that there’s no evidence whatsoever to support the notion that QE increases “healthy” inflation and/or has a demonstrable impact on output) even if Bernanke does not.

If you needed proof of the widening gap between the rich and everyone else (and the attendant rise of class segregation) beyond that presented by the St. Louis Fed study linked above and by the anecdotal evidence that’s readily observable by looking at the prices paid this year for high-end art and mega mansions, look no further than Wall Street, where, thanks to the Fed’s generosity, Lloyd Blankfein is now a billionaire.

Speaking of Goldman Sachs and income inequality, back in April, Hank Paulson and Robert Rubin sat down with Sheryl Sandberg and Tim Geithner at an event hosted by Michael Milken (no less), to discuss a variety of topics. Around a half hour into the discussion, Sandberg asks Paulson about income inequality. Here’s what happens next:

Sandberg: “Yeah, so let’s follow up on a bunch of the things we were [talking about]. Let’s start with income inequality.”

Paulson: “Ok, well.. income inequality. I think this is something we’ve all thought about. You know I was working on that topic when I was still at Goldman Sachs..”

Rubin: “In which direction? You were working on increasing it.”

Paulson then bursts out laughing: "Yeah! We were making it wider!"

Here’s the clip:

[billyboy15]

Why is this even an issue? Am I the only one who thinks this is ridiculous?

Why should wealth increase equally? How can it?

If I am worth a million and my net worth increases 5% it is a $50k increase. My neighbor has a hundred k and it increases 5% or $5k. So the gap has widened. Who except some ideologically driven moron looking to whip up the ignorant would give a damn? Why do we care about people who are just jealous of what others have?

[Little Ray]

“Wealth gap” is a truly evil concept.
What it means is that, if you save your money, or invest it in stuff that holds its value, and create legacy for your children, that is UNFAIR to folks who squandered all they had on tennis shoes, iPhones, and lottery tickets.

[CincyRichieRich]

Nice how these wizards of smart leave the EPA costs and beef and fuel and other things out of their calculations.

[bert]

there is no wealth inequality

there is human inequality stemning from many causes but mostly the making of many poor decisions that are at root laziness.

that is, laziness over and over easy way out decisions result in the inability to earn

[Trailerpark Badass]

Seems pretty cynical to import tens of millions of the poorest people on earth and then complain about a wealth gap.