You are Tom Cruise?
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You should spread the stocks evenly like Russians did in 1991. In just a few years most of the Russians were shit poor and all wealth was in the hands of few oligarchs. Nothing criminal happened, most just invested in cheap vodka.
MY TRUST FUND, WHERE DID I PUT IT
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Those political movements have historically reached the point of wiping out the wealthy only when wealth has been concentrated at the top to such an unsustainable degree that, revolution or not, the middle class is already being decimated (admittedly in a less violent way).
You’d think the wealthy might have learned from history about the danger of getting too greedy, but here we are with this headline which, however one interprets it, is bad news in that regard.
You’d have more individuals with skin in the game, demanding that their institutional go-betweens put more pressure on corporate boards to keep a lid on executive compensation and be less tolerant of incompetence and corruption. As it stands now, the wealthiest 10% are willing to give boards a little more breathing room on matters like that because they can realistically see themselves in executive management positions or are already there.
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Citation is not required. Do not @ me or reply to me.
The better terms to use for that are “high net worth individuals”
(investable assets >$1-million, excluding primary residence) and “ultra-high net worth individuals” (where the point of entry goes leaps $1-million to about a minimum $30-million).
To get an idea of scales, as of 2017 there were just over 15-million HNWIs in the entire world (out of 7.5-billion people – 0.2% of humanity). About 5-million of them live in the U.S. (population 325-million - 1.5% of Americans*). The numbers of UNWHIs are much tinier.
[*which is not to say they’re “the 1%” as that term is normally used. That’s calculated differently based on income or total assets, as @LurksNoMore points out above]
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Thank you. That does give additional definition to my point.
The point is that people tend to think of being a millionaire as some magical and unattainable thing. And for some folks that may be true. But ones value is more than just the cash they have in their savings account. And while many in the US do not have large retirement savings they do have home ownership and insurance policies which are part of individual net worth.
The point is being “worth” a million today is fairly easy to attain. And is not a measure of financial stability.
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The scare quotes are on point. That life insurance policy only kicks in when you’ve died, so it’s more part of your childrens’ wealth than yours (assuming you’ve kept up on paying the premiums).
Similarly, you increasingly have to be old or nearing retirement age to have paid off a million-dollar primary residence. If there are no real retirement savings you basically have to borrow against it, which immediately reduces equity in the home. There’s a reason all those dodgy reverse mortgage companies started spending so much money on TV ads after the 2007-08 crash.
That’s why most Americans who call themselves “millionaires” because they live in a McMansion and pay their life insurance premiums are fooling themselves about their wealth. You’re not a “millionaire” if you don’t have a liquid $1000 in your savings account for an emergency, per the link posted above.
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Well. Not always do you have to die. Some have pay outs based off escrow. Not always term. You don’t have to have bought a million dollar home to have one worth that. Without going into massive detail that really isn’t important. The point simply is. It’s not as exclusive a club as it once was.
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With the present rules, by not selling you lose the opportunity to offset gains, so by all means - sell! (Then buy right back in.)
If it’s Cramer, then yes, that’s what he gets paid for!
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Some of them, yes. But for others (the ones who aren’t already wealthy) it’s just the equivalent of trying to set themselves up as seers in the hope that they might get paid more in the future or as Cassandras in the hope that they’ll gain more respect.
Whatever the motivation, the end result is what you describe: bargain buying opportunities for the 10%, whose money managers can move fast.
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that’s no small part due to inflation tho. 1 million in 1950 is what? 10 million today?
we should have seen a percentage increase in the number of millionaires equal to that – but i’d assume rising wealth inequality means there are fewer “10 millionaires” today than there were “1 millionaires” in 1950.
( also, i’d figure there’s a lot more people who are going to be permanently excluded from that group no matter what they do. wealth seems to now be staying within families – and not built up from an individual’s labor. re: less social mobility. )
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GE eh? That’s a rather painful one lately. It’s down a lot, my only holding with over 10% in unrealized losses. I’ll be selling most or all of it this year to offset cap gains.
As far as index funds, they’re not bad but my holdings are a mix of stocks, bonds, preferred stock, and mutual funds. Almost all of them are outperforming index funds and the portfolio as a whole is outperforming the market. I also have good financial advice from someone who’s full time job is to track that stuff. All that to say, index funds are not the great savior some here make them out to be. Not bad, just not amazing.
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France? America?
Mark Twain’s greatest quip’s regarding Currency…
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Point taken. We’ll merely guillotine the 3,300 richest Americans. That alone will be worth trillions. (But Gosh, maybe to be safe, we’ll just guillotine 33,000.)
(Note: Persons like Buffett and Gates, who have already pledged their money to society and have not yet been guillotined by Father Time, get a pass.)
In the same vein, notice that whenever talk moves to raising the marginal or corporate tax rates, they’ll always jump to the extreme: “Well, we can’t have a 90% tax rate!” Every right-wing talking head broadcasts this meme, and uses the same outrageous “90%” figure. Even as the politicians are cutting taxes as fast as their tiny sausage-fingers can. The Overton Window has been pushed so far right, Democratic policy is merely “to keep taxes stable.”
Don’t worry. I won’t Robespierre it. I’m just pushing the Overton Window, advocating for an unreasonable 33,000 guillotined, so we can get a reasonable 3,300 guillotined.
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Teh Wiki puts the total executions during the Terror in France in the tens of thousands, so you’re in the ball park. Also, 33k is less than 1% of America’s high net worth individuals, which would leave plenty of rich folks safe. Since you’re sparing good-guy billionaires and (more importantly) since I’m nowhere close to that level of wealth I’m on board with this, Citoyen Petzl.
[now watch the Libertarians roll in to tsk-tsk about all this talk of guillotines. Funny how, before “inequality” entered the public discourse, everyone took their mention as it was intended: as dark humour or, at worst, as an admonitory spectre about the wages of greed. Now they claim that Cory is advocating for a return of the actual device.]
They’re terrified (or want to terrify people) about a return to the days of that wild-eyed Commie wealth redistributor, Eisenhower. And with no good reason, because ultimately his 90% top marginal didn’t affect all that many people and between 1950 and 1959 the highest-earning 1% of Americans paid an effective tax rate of 42%.
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Agreed. Before I was married I had a good job and a 401k but my net worth was probably around 250k at best. Mid 30s and while not the best saver I also wasn’t a frivolous spender either.
Dollar cost averaging is an example of the the sunk cost fallacy.
