John Cassidy has an excellent article about the banking industry, but I quibble with his ending:
Helping the banks isn’t the Fed’s primary aim, of course. Ben Bernanke’s monetary policy was designed to stimulate the over-all economy… But one of its side effects has been that some of the very [banks] that brought about the financial crisis have received an implicit subsidy. In this way, as in many others, the old rule for banks still applies. Heads they win; tails we lose.
If you look at the Fed’s charter and even its governance structure, it is clear that its primary mission is helping banks not ordinary American workers. The Fed stimulates the ‘over-all economy’ during a recession because it is good for bank profits, and the Fed is happy to stimulate the economy as long as it doesn’t hurt the banks. The problem is when the banks are feeling flush, but American workers are not. That is when the Fed’s true priorities are revealed.
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