Remember when - for years and years after the grand, global QE experiment started - any suggestion that central bankers are the primary cause behind global wealth inequality, and thus directly responsible for such political outcomes as Brexit and Trump - was branded as a conspiracy theory by bloggers living in their parents' basement? We do, because we were accused over and over of just that (our position on the Fed and other central banks should be familiar to all by now).
Well, as of this morning, none other than the chief investment strategist at BofA, Michael Hartnett, is a basement dwelling, tinfoil hatter because in his latest Flow Show report, writes that "central banks have exacerbated inequality via Wall St inflation & Main St deflation."
Of course we knew that, you knew that, and pretty much everyone else knew that, but those whose jobs depended on not admitting it, kept their mouths shut terrified of pointing out that the central banking emperor is not only naked, but an idiot. Well, the seal has been broken, and even the biggest cowards from within the financial establishment, most of whom can be found on financial twitter for some inexplicable reason, can speak up now.
However, it's what Hartnett said next that was more notable, namely that the "massive outperformance of deflation assets versus inflation assets shows central bank failure in War on Deflation...they have failed to boost wage expectations, inflation expectation, “animal spirits” on Main St."
And, according to the Bank of American, now that central banks are in full reverse mode, there are "two ways to cure inequality...you can make the poor richer...or you can make the rich poorer..."
So for anyone still confused, about what is taking place right now, the "Fed/ECB are now tightening to make Wall St poorer" because it is "no longer politically acceptable to stoke Wall St bubble."
Sooner or later the market will get it, and when it does, those who sell first will be happy. Everyone else will be stuck with a market that is locked limited down, with no position sales possible indefinitely, maybe in perpetuity.