The Federal Reserve benefits its favored class in the method it uses to push new money into the economy. The Fed does not increase everyone's cash balances simultaneously in the same proportion. It injects reserves into commercial banks and they then lend new money to borrowers. This injects money into the economy at specific places at specific times. As I said this morning in my conference presentation,
Increasing the money supply merely increases the amount of money being spent on the same quantity of goods, so overall prices increase and the purchasing power of the dollar falls. Those people who receive the new money first benefit while those people on fixed incomes are harmed. However, there is no general social benefit from inflation.
The contribution of Mises is likewise recognized by Spitznagel. He writes,
In the 20th century, the economists of the Austrian school built upon this fact as their central monetary tenet. Ludwig von Mises and his students demonstrated how an increase in money supply is beneficial to those who get it first and is detrimental to those who get it last. Monetary inflation is a process, not a static effect. To think of it only in terms of aggregate price levels (which is all Fed Chairman Ben Bernanke seems capable of) is to ignore this pernicious process and the imbalance and economic dislocation that it creates.
The Fed, having gone on an unprecedented credit expansion spree, has benefited the recipients who were first in line at the trough: banks (imagine borrowing for free and then buying up assets that you know the Fed is aggressively buying with you) and those favored entities and individuals deemed most creditworthy. Flush with capital, these recipients have proceeded to bid up the prices of assets and resources, while everyone else has watched their purchasing power decline.