Our Economy’s Real Problem: The Fed’s Easy Money

Americans know that there is a serious problem in the economy. Incomes are stagnant, and the employment situation is not improving in a meaningful way.

In fact, according to new Census data, average American incomes remained virtually unchanged in 2013 and were actually 7% lower than in 2007 after adjusting for inflation.

And yet, GDP continues to rise, and we are assured by the administration that the economy is in recovery. So what’s really going on here? A look at the data is revealing.

Until 1999, GDP and income growth tended to move together. But since the turn of the millennium, incomes have remained flat while GDP has continued to rise, according to an analysis from the New York Times. Observing the peaks and valleys of the income line leads to some interesting conclusions.