Question

Contemporary Economics (4th Edition), Chapter 15, Question 12 - Why do critics argue that the Fed has aggravated the income gap between the rich and the poor?

Answer 1

Feb made the monetary policies in order to promote the jobs and keep the inflation near the target. Still the policies warned by them are warned by the critics that these policies will be ineffective and even if the policies are effective then it may lead to overinflation or may collapse the value of dollar. The claim by the critics that fed has aggravated the income inequality between rich and poor is monetary policies werre easing the works in parts by raising the price of asset like price of stock. As you have seen the rick class owns more assets than poor this results in increase in disparity of wealth between rich and poor