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Nobody But US! Why the Rise of the One Percent Makes Janet Yellen’s Job Harder(?)

This is a syndicated repost published with the permission of Confounded Interest. To view original, click here. Opinions herein are not those of the Wall Street Examiner or Lee Adler. Reposting does not imply endorsement. The information presented is for educational or entertainment purposes and is not individual investment advice.

Bloomberg has an interesting piece this morning entitled “Why the Rise of the One Percent Makes Janet Yellen’s Job Harder.”

Income inequality could be making Janet Yellen’s job even harder.

Rich Americans spend less of their paychecks than households of more modest means. As the top one percent accounts for an increasing share of the nation’s income, it may be reducing consumption, hurting growth and boosting savings. That could be contributing to rock-bottom interest rates that have left the Federal Reserve chair with little scope to ease in the next recession.

Take David Levine, a former chief economist at Sanford C. Bernstein & Co. who’s been a member of the one percent for decades. Levine says he’s “not living frugally” yet still spends only about a fifth of his income to maintain a very comfortable lifestyle on Manhattan’s affluent upper west side.

Contrast that with a middle-class American family. Those making between $70,000 and $80,000 spent about 78 percent of their incomes in 2014.

There is no doubt that income inequality is worsening since the end of 2007.  Declining real median household income combined with massive monetary easing from The Federal Reserve is creating even more income inequality.

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The top 1% are taking home a bigger share of the income pie.

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With Central Banks (including The Fed) blowing asset bubbles, is it any wonder that income inequality is growing?

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There is only so much The Fed can do in terms of stimulating higher income jobs (in fact, they may have no impact at all).  But Fed policies are a big winner for Wall Street!!!!

Here are Goldman’s Lloyd Blankfein and Warren Buffett singing “Nobody but us.”

lloyd-blankfein-gushes-about-the-awesomeness-of-warren-buffett

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