Fed Policy Is Best Propaganda for Socialism
HOUSTON, TEXAS - March 13, 2019
Last week, the bull market turned 10 years old. And many are now wondering whether the new generation of socialists has emerged thanks to the efforts of the Fed undertaken during the reign of former Chairman Ben Bernanke, specifically his efforts to avoid another deflationary collapse in the style of the 1930s.
Bernanke’s quantitative easing, also known as large-scale asset purchases, led to a sharp rise in asset prices, with the result that the Millennials were driven out of many asset markets, including the housing market and the stock market. Inequality across the country has reached an unprecedented level.
When expansionary monetary policy makes asset prices rise faster than wages, the average person, or even 90% of the lowest-income Americans, lags behind the asset price curve. And the faster the asset-based economy expands, the greater the inequality. This threatens the public conviction that as the economy grows, the standard of living of absolutely everyone in the country improves, or that capitalism works for everyone. Thus, one of the side effects of printing money is now being felt.
According to the new Axios survey, Generation Z and Millennials adhere to the principles of socialism more than ever. Young Americans are trapped in ruinous debt and low-paying jobs. They are unable to enter the housing market so they have to rent houses. And given the rising costs, we can well assume that this generation is broke. And this helpless generation will make up 37% of the electorate in 2020 and more than 75% of the workforce by the mid-2020s. Socialism is no longer a concept that is condemned by this group. About 50% of young Americans would like to live in a socialist country.
To make matters worse, 37% of Americans are more inclined towards a socialist rather than a capitalist economy. Basically, young voters want affordable health care and free education, according to the survey.
During the survey, 3 main points were highlighted that concern Generation Z voters now: mass shootings, racial inequality, and immigration policies and the treatment of immigrants.
The main sources of concern for Millennials are affordable health care, global warming, climate change, and mass shootings.
The main problems affecting generation X are affordable healthcare, terrorism, national security, and public debt.
Taking into account the fact that within the framework of quantitative easing, the younger generation was subjected to financial punitive measures that helped to prevent a deflationary collapse of the economy, the Fed inadvertently turned tens of millions of young Americans into socialists.