Will No One Heed Paul Singer’s Clarion Call?


You'll all be sorry. You'll see.

Paul Singer has not been shy about expressing his feelings about the Federal Reserve. In effect, the hedge-fund billionaire’s argument is that quantitative easing is the root of all evil in the world and must be stopped.

Well, even though the Fed has stopped buying bonds, Paul Singer is not satisfied that he has been heard. And so he’s taken his message to Davos. Alas, no one appears to be listening on that side of the Atlantic, either.

“Inequality is a function of the government’s policies,” said Singer. “There is no question that QE is adding to it….”

Singer argued that any predictive power markets once had has been eroded by the Fed. “I would put ‘market’ in quotes,” said Singer. “You don’t know what the real price is. The market is determined by the Fed.”

Nouriel Roubini took time off from organizing the WEF’s hottest late-night shindigs to both agree and disagree with his co-panelist. He agrees, to an extent, that inequality can be said to be a function of the government’s policies. He’d just like to point out that it cuts both ways.

New York University Professor Nouriel Roubini, who was also on the panel with Singer, countered that without the Fed’s stimulus, there would probably be a lot more unemployment in the U.S. That would have probably added to inequality as well. “QE may be helping the rich, but the alternative would be much, much worse for the middle and lower class,” said Roubini.

Paul Singer: The Fed is causing inequality [Fortune]
E.C.B. Stimulus Calls for 60 Billion Euros in Monthly Bond-Buying [NYT]