Investing in stocks is marketed as believing in America. Imbedded is the assumption that buying stocks is a fair deal. An investor might make or lose money, but the same chance was taken by all participants.
Although they have received little notice, the recently released 2004 Federal Reserve Open Market Committee (FOMC) transcripts show how the Fed was channeling its attention and distorting markets for the benefit of favored institutional investors. (See AuContrarian.com “blog” The 2004 Fed Transcripts: A Methodical, Diabolical Destruction of America’s “Wealth”.) The 2004 Transcripts were not so much a revelation as a confirmation. The Fed’s valiant attempt to prevent the economy from deflating (its claim at the time) by inflating asset markets is now a matter of public record. FOMC members explicitly stated they were working with hedge funds and pushing housing prices up.[Read more...]