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posted by FatPhil on Tuesday August 22 2017, @01:23PM   Printer-friendly
from the Philosophers-Stone dept.

"Although today high levels of inequality in the United States remain a pressing concern for a large swath of the population, monetary policy and credit expansion are rarely mentioned as a likely source of rising wealth and income inequality. [...]

The rise in income inequality over the past 30 years has to a significant extent been the product of monetary policies fueling a series of asset price bubbles. Whenever the market booms, the share of income going to those at the very top increases.[...]

[F]inancial institutions benefit disproportionately from money creation, since they can purchase more goods, services, and assets for still relatively low prices. This conclusion is backed by numerous empirical illustrations. For instance, the financial sector contributed massively to the growth of billionaire's wealth"

Source: https://mises.org/library/how-central-banking-increased-inequality

I'll leave my comments as comments, but note that The Mises Institute is proudly, one might say almost by definition, Austrian School. Both the Institute and the School have had their fair share of criticism. Which of course doesn't mean that individual author is wrong on this particular matter. -- Ed.(FP)


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  • (Score: 1) by Gault.Drakkor on Wednesday August 23 2017, @01:26AM (1 child)

    by Gault.Drakkor (1079) on Wednesday August 23 2017, @01:26AM (#557800)

    Wealth is power. Wealth is political voice. Huge wealth is easily translated into political power. As you point out there are many different political stripes that are wealthy.

    But in balance there are more selfish people then people who want what is best for the major majority. If they have a political axe to grind they can employ people full time to see that that axe is ground.

    But the biggest problem with wealth is that it is accumulating at an accelerating rate. That is, approximately for each magnitude of wealth, you can get an additional .5% income from said wealth. How? if you have 100K$ wealth, at 1% spent on wealth manager you have him for part of his time. at 100M$ you have 1M$ to spend on manager, probably do better finding deals, can broaden investment portfolio etc. Or as in this article you have access to investing best opportunities at financial institutes. Somewhat minor cost of living is not proportional to income. Higher wealth allows for more income to be available for re-investment.

    There are positive feed-back loops on income+wealth at low and high ends driving it to extremes. This is going to further destabilize the economies of the world.

    The decisions of the wealthiest have big influence on every bodies lives. The more wealthy the bigger the possible influence.

  • (Score: 2) by The Mighty Buzzard on Wednesday August 23 2017, @12:24PM

    by The Mighty Buzzard (18) Subscriber Badge <themightybuzzard@proton.me> on Wednesday August 23 2017, @12:24PM (#557942) Homepage Journal

    I fail to see any of that as a problem. Someone having a pile of money big enough to paper the walls of their mansion has no effect on me. Money and wealth are not remotely finite.

    Political power? It's still one man, one vote (or one corpse, one vote if you're a Democrat). You really want change, stop voting for the ones that you know will sell you out. I did.

    --
    My rights don't end where your fear begins.