There was a Comment article today in the US print edition of the Financial Times with the title, Central Banks are making the rich richer. The article was penned by Paul Marshall, a hedge fund manager, and it basically suggests that Quantitative Easing (QE) has put money, cash, into the pockets of big business, and the investor class. This is exactly what I called out September in Where has all that money (from Quantitative Easing) gone?
The market is not operating as a free market at all. It is rigged and being managed (at least the Fed thinks it is managing the market). Worse, a result of QE and the rich getting richer will be that inequality will be shown to have increased. This will lead not to a poilicy for reducing the amount of money in the market (i.e. quantitative tightening) but for tax increases and redistribution efforts. Oh dear – wrong weapon, wrong target, wrong time.