Over a decade ago in 2001, the Federal Reserve planted the seeds of the 2008 financial crisis by lowering its target for the federal funds rate from 6.25 percent to 1.75 percent. Since this interest rate is a benchmark number used throughout financial markets, many first-time homebuyers were able to enter the housing market thanks in part to both new looser lending standards and the record-low teaser mortgage rates banks were offering.

The Fed then lowered the rate even further in 2002 and again in 2003, when it reached just 1 percent and stayed there for more than a year. These easy money policies may have helped temporarily decrease unemployment and drive homeownership rates to record highs, but they also created a real estate bubble. When that bubble popped in 2008, it precipitated the biggest recession since the Great Depression more than 80 years ago.

But surely, the Federal Reserve has since learned its lesson, right? It would never try to lower unemployment by implementing easy money policies that would create another asset bubble. Would it?

In fact, the Federal Reserve has learned nothing. It is again implementing loose money policies, this time through quantitative easing, and it is again creating artificial asset inflation. Worse, this time the Fed's distortionary policies are primarily benefiting the wealthiest Americans while making a nation of serfs out of young families who are just trying to get their start.

Amidst the weakest economic recovery since World War II, the Federal Reserve has lost the power to fight unemployment by lowering the federal funds rate. It is already as low as it can go.

Instead, the Fed is now implementing a strategy called quantitative easing, which consists of purchasing $85 billion worth of assets, like mortgage-backed securities, every month. The Fed pays for these assets by simply creating new money out of thin air. By buying up safe assets, the Fed hopes to push investors into riskier investments that offer higher returns.

And it's working.

Janet Yellen, who was appointed Federal Reserve vice chairman by President Obama and is his likely choice as the next Fed chair, recently admitted, "Even if the interest rate channel is less powerful right now than it was before the crisis, asset purchases still work to support economic growth through other channels, including by boosting stock prices and house values."

Thanks to the Fed's printing press, the Dow Jones recently hit an all-time high. And real estate prices are surging, too. Which is all great news ... as long as you are already wealthy and own assets. The wealthiest 5 percent of Americans own 82 percent of all individually held stocks. And only they have the cash to turn a profit in the real estate market. By buying foreclosed or otherwise distressed properties on the cheap, repairing them and then renting them out, wealthy investors are earning 8 to 12 percent returns on their investments.

Without the Fed's involvement, this would be a great capitalist success story in action. But thanks to the Fed's asset-boosting policies, many middle-class families looking to purchase their first homes are being priced out of the market.

In February, median home prices in Southern California rose a mind-boggling 21 percent. Unfortunately, investors accounted for a record high 31.4 percent of buyers. The number of buyers paying with cash was 35.6 percent, also a near-record high. Middle-class families, especially those trying to buy in California, don't pay for their first homes with cash.

Besides creating a nation of renters who would rather be landowners, what happens when the Fed stops artificially juicing asset prices by $85 billion a month? What happens when all that real estate stops producing an 8 to 12 percent return? Will investors exit the market slowly? Or is another real estate bubble-burst just around the corner?

I'm sure Yellen and the rest of the Fed have the answers to all these questions. When have federal government experts ever been wrong?

Conn Carroll ( ccarroll@washingtonexaminer.com) is a senior editorial writer for The Washington Examiner. Follow him on Twitter at @conncarroll.