DISQUS

The Fed is a quasi-public/private institution. Most of the money it has it has created out of thin air, meaning that it's not the taxpayers money specifically, although we all have a stake in the currency. The Fed has borrowed a great deal of money from the Treasury (taxpayer money), but it certainly hasn't borrowed more than a few hundred billion. Most of the trillions that the Fed is lending out have simply been generated.

Ones personal inflation level is always going to be different then the basket used by the BLS. But just because caviar has gotten more expensive relative to bread doesn't mean rich people are poorer. The more money you have, the more options are open to you. The rich could shop at Wal-Mart if they wanted to, the homeless couldn't buy anything on 5th Avenue.

This measure of inequality, using separate CPIs for different income groups, is certainly worthwhile. It might explain why rich people consistently are greedy, even though it seems like they should have enough. But it's not correct to say that inequality is the same now as it was 30 years ago, when the dollar value disparity in income and wealth is so much larger.

A fair measure would be to look at the percent of the top quintiles income which would be necessary to maintain the middle, or lowest, quintiles standard of living. That ratio has gotten lower.