It takes $500 to build a well-diversified portfolio with a roboadvisor, and that portfolio will behave comparably to a larger one (it'll be a bit worse, but also taxed at a lower rate). So, if everyone invested their savings rationally, then when the Fed propped up stock prices, it wouldn't change the distribution of savings across the population.
The real issue is that a larger percentage of the poor's assets are in items that depreciate.
In the '08 crash, a the percentage of people in the US that owned a home dropped from 69% to 63.5%, and is only starting to recover:
The Fed has been keeping mortgage rates low, and that has certainly helped home ownership rebound. So, it's more nuanced than "the fed steals poor people's money".
(Don't get me wrong; the system is rigged to transfer wealth to the rich. I'm just saying there is more than one mechanism at play.)
Except high income earners can choose to invest a much higher percentage of their income.
I can invest 80% or more of my take home pay if I choose to live frugally. Somebody close to minimum wage can probably get somewhere closer to 10%, which would come at greater personal sacrifice.
Agreed that more people should participate in investing and there's an educational/behavioral component, but recent government interventions have been excessive and basically amount to inflation of asset prices.
Dropping interest rates helps people purchase a home "today", but home prices quickly appreciate such that the carrying cost of the home is exactly the same as before, just priced higher and weighted more towards principal payments.
This entire narrative falls apart when you consider credit and why rents exist.
There are people living in London that have been paying rent on the dot for 20 years and still can't get a mortgage because they are not deemed credit worthy. Each month they pay £1,500, they landlord pockets £200 and uses the rest to pay the bank. 30 years later, landlords owns a home worth £300,000 + £72,000 of recurring income, and the family owns nothing. Being self employed or on zero hour contract can do that to you.
But even if you are an upper-middle class homeowner, you still loose against someone who own real assets. They can borrow ridiculous sums against existing assets at near-zero interest rates and invest with leverage, making millions of capital gains while you squirrel away whatever pennies you can spare into your pension and mortgage.
Most Americans don't have disposable income to invest in the stock market.... there is no amount of investing that will turn their "barely making ends meet" wages into a living wage.
The median US household has ~$1000/month in investable cash left over after all ordinary expenses. Per the Bureau of Labor and Statistics (BLS) which tracks in detail how much people actually spend on myriad things in each income decile.
Americans are notoriously poor at actually saving or investing that money compared to their counterparts in other developed countries, but $12,000/year is quite a lot to invest in the stock market. If you saved even half of that you'd have a comfortable retirement.
"You'd have a comfortable retirement" implies stock returns are knowable, which they are not. And the people assuming forward returns will be like past returns seem to be the least knowledgeable on evaluating assets.
12,000 a year is a lot less per year if you are saving for your child's college education.
It takes $500 to build a well-diversified portfolio with a roboadvisor, and that portfolio will behave comparably to a larger one (it'll be a bit worse, but also taxed at a lower rate). So, if everyone invested their savings rationally, then when the Fed propped up stock prices, it wouldn't change the distribution of savings across the population.
The real issue is that a larger percentage of the poor's assets are in items that depreciate.
In the '08 crash, a the percentage of people in the US that owned a home dropped from 69% to 63.5%, and is only starting to recover:
https://www.statista.com/statistics/184902/homeownership-rat...
The Fed has been keeping mortgage rates low, and that has certainly helped home ownership rebound. So, it's more nuanced than "the fed steals poor people's money".
(Don't get me wrong; the system is rigged to transfer wealth to the rich. I'm just saying there is more than one mechanism at play.)