Diane Swonk:

Well, first of all, there is a big disconnect between the drivers of the stock market, just a few of a handful of a few firms that happen to be benefiting from this horrible environment, pushing it higher, and many of the firms that have been hit hardest are small companies, small businesses that are not even listed on publicly traded companies.

So that’s one of the issues, and other issues, of course, that, you know, low interest rates tend to benefit the stock market first, the tools that the Fed has to stimulate the economy are very blunt. And unfortunately, it shows up in the stock market more than it shows up on Main Street. But it is important because you can’t have credit markets functioning and have jobs generating as well.

So the Fed has to do what it’s doing in order to reach those who are hardest hit by this crisis, yet it does exacerbate some inequalities in wealth out there. And that’s something they’re coming very much aware of at this stage of the game.

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