The answer for rising inequality from American leadership since the 80's has been inflationary asset and commodities bubbles created by credit expansion. There has been a long term slide in interest rates, 40 years of a collapsing fed funds and treasury rates an the absolutely massive growth of private, government and consumer debt. This created a series of asset bubbles whose well documented demises wreaked economic havoc but also grew wealth to insane levels. we're trapped in a feedback loop. The market and major american Industry is dependent upon credit expansion to the detriment of the working class and the working class is up to its eyeballs in debt already a record high at $14-16 trillion.

The majority of this inflationary credit expansion goes directly to the top 1%. The working class will continue to get squeezed until the system breaks again.

The financialization of the markets by the FED has garunteed continued market collapse. The market knows it will be bailed out. The interventionist credit expansion is inflationary, new credit in the system is inflationary.

Open market operations like Quantative easing, repos, and bailouts have the same effect as increasing the money supply. The Fed issued new credit to buy MBS's and rapidly devaluing US treasuries. The greater the supply of money in an economy, the lower the corresponding interest rates are. In turn, lower rates allow banks to make more loans. Increased lending stimulates demand by giving businesses money to expand and individuals, money to buy things like homes, cars, and boats.

By increasing the money supply, QE keeps the value of the country's currency low. Short term bond rates will be going negative soon. Which demonstrates the market is in bad shape, demand is so great for short term bonds the yields are going negative an banks are still buying.The majority of the new credit isn't making it to the productive economy. The market is now dependent on the systemic flaws. The FED and monetary policy is the problem crypto is the answer.

That was a comment from 3 years ago

What's changed in that time? The financial system has begun to change more rapidly than it has in 70 years. Prior to the great financial collapse of 2008. Every interest bearing financial product and the cost to borrow was fixed with the LIBOR the London Interbank offered rate. This was abandoned for SOFR secured overnight funding rate. Where the market for interbank settlements was dominated by unsecured interbank lending in the tens of trillions.

Through a alphabet soup of lettered agencies and the FED unsecured interbank lending is essentially illegal it's so heavily penalized. Banks now prefer to borrow directly from the FED.

The FED seems to have started to take a different tact. Everyone is familiar with the massive expansion of the M2 explained above. Pumping trillions Into the financial system to try to create a new bubble of over consumption and paper over hundreds of Billions in losses in systemically important banks, Same plan as 08', the economy was a hollowed out corpse before the corona virus. The plan was the same, bail out the wealthy and huge corporations then hope the bubble is a bandaid over the bullet hole in the real economy.

Only now the tact the FED is taking is in reverse. During the recovery from 08' the FED encouraged mid size to small banks to hold long term duration treasuries as a means to shore up balance sheets and the FEDs own position after devaluing treasuries in 08'. The m2 is collapsing at a higher rate than any time in history. The FEDs plan seems to be raise rates at all cost to fight inflation but is it an excuse to rapidly raise rates for a rugpull of the very institutions it encouraged to hold long term duration treasuries. Small to mid sized banks do not have the infrastructure for complex interest rates swaps to offset the risk of a rapidly changing interest rate environment. Is it also coincidence that regional and mid size banks represent the bulk of American deposits. Assets ripe for the picking to shore up systemically important banks balance sheets. Is the plan to fight inflation while cannibalizing regional banks? The FED raises rates tomorrow and more assets up for acquisition.