Wall Street watcher and economist Nomi Prins has written a series of books that seems to make that explanation. I will be reading her books to see if I buy into her thesis.
During fifteen years as an executive at skyscraping banks like Goldman Sachs, Bear Stearns, and Lehman Brothers, Prins never lost her ability to see the broader picture. She walked away from the game in 2002 out of disgust with the burgeoning corporate corruption, just as its magnitude was becoming clear to the public.
In this searing exposéformer Wall Street insider Nomi Prins shows how the 2007-2008 financial crisis turbo-boosted the influence of central bankers and triggered a massive shift in the world order.
Central banks and international institutions like the IMF have overstepped their traditional mandates by directing the flow of epic sums of fabricated money without any checks or balances. Meanwhile, the open door between private and central banking has ensured endless opportunities for market manipulation and asset bubbles â with government support.
It is abundantly clear that our world is divided into two very different economies. The real one, for the average worker, is based on productivity and results. It behaves according to traditional rules of money and economics. The other doesnât. It is the product of years of loose money, poured by central banks into a system dominated by financial titans. It is powerful enough to send stock markets higher even in the face of a global pandemic and threats of nuclear war.
This parting from reality has its roots in an emergency response to the financial crisis of 2008. âQuantitative Easingâ injected a vast amount of cash into the economyâespecially if you were a major Wall Street bank. What began as a short-term dependency became a habit, then a compulsion, and finally an addiction.
Her latest book, Permanent Distortion: How the Financial Markets Abandoned the Real Economy Forever, is a highly readable and clear account of how the financial realm, with its central bank-fueled loose money and mega-wealthy financiers, has split off from the real economy, the place inhabited by regular working people who buy stuff and produce things.
The upshot: the peopleâs needs are increasingly ignored in favor of market demands.
Which is why income inequality continues to rise as it is the wealth that own most of financial markets.