Without question, the biggest winner of the 4 ½-year recovery is corporate America.
Publicly traded companies have reaped most of the benefits of the Fed’s ultra-loose monetary policy and have completely recouped the losses in share value since the credit crisis. Meanwhile, Main Street struggles on and hasn’t reaped nearly as much benefit from QE3 than corporations have.
The increase in merger and acquisition activity in the last two years testifies to the consolidation of corporate power. Bull markets always result in frenzied M&A activity, which in turn stimulates the growth of oligopolies.
One school of thought is that bull markets are engineered for the express purpose of enhancing oligopoly power. Whatever the case, there’s no denying that the last few years have done more for Corporate America than for Main Street America.