In case you ever doubted it, here's a headline and a lede that says it all:
"Wall Street Lower, Wage Hikes Stir Fears AP -
Stocks fell Wednesday after the Labor Department said productivity decreased and wages increased in the spring, stoking fears that wage inflation will prompt the Federal Reserve to return to a policy of interest rate hikes."
You see, neither the Federal Reserve nor investors in the stock market--large financial and capital institutions, mostly--are fundamentally at war, economically, with the workers who toil in investor-owned corporations. During the "Bush recovery" increased productivity (meaning a decrease in, or stable, number of worker hours needed to produce increasing corporate revenue) resulted in escalating corporate profits while wages didn't move in dollar terms, and actually decreased in terms of the cost per unit of production. This allowed corporations to gain profit without increasing price--without, therefore, causing price-driven inflation--and to do so on the backs of the workers' increased productivity, without, in other words, passing any of the increased profit down to the workers in the form of wage increases.
But now, with signs that wages may actually be increasing (as certainly they must, to keep up with the increasing prices of consumer goods, especially gasoline but also most other products)investors fear that the foregoing situation may no longer be extant, that workers may actually be able to participate in the increased profit of their employers' business. This, "wage inflation" may, they worry, cause the Fed to slow down corporate activity--meaning, to the worker, fewer jobs and no more pay increases--by raising the cost of borrowing.
That prospect--of the Fed's increase of interest rates--will do two things that stock investors fear: (1) It will diminish corporate profit; and (2) it will make bond interest-rates more attractive as an investment. The market's negative reaction to pay increases for workers is therefore classically anti-worker and is built into the system. Even if, in theory, such pay increases should lead to greater consumer spending--and hence a well-founded continuation of economic recovery--it is now the case that such increases will likely only go to lending institutions which, by way of credit-card debt and increased mortgage payments due to the flurry of mortgage refinancing, have been the source, for the last five years, of most of consumers' cash availabilty.
So--it's bad news for Wall Street that the workers are finally getting a pay increase. Except, perhaps, for the brief periods when workers actually gained wages in tune with increasing productivity, it always has been.