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World's richest 500 see their wealth increase by $1T this year

theguardian.com

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Re: World's richest 500 see their wealth increase by $1T this year

#151

Post by jrs95 »

volgo wrote: post #126

As capitalism matures, it's clear to anyone with a thread of financial literacy that most wealth is created through capital gains rather than salary. We're approaching a state (at least in developed countries) where productivity is so high, that you can literally park your money in 500 of the biggest businesses and you're almost guaranteed a 7% annual return (if you hold stocks for the long term). Using the commonly…

Middle class people can take advantage of those investment returns as well. A more interesting question to me is “Why aren’t they?”. A typical middle class person can still achieve significant upward mobility for their children, and yet they often choose not to. Is part of the problem with student debt not just that many parents of the last generation or two wasted their money rather than saving it to put their children through college? I’ve known a few people whose parents wouldn’t even attempt to take out Plus loans for them. The lack of upwards mobility seems to be based more on some sort of social disease than just economics at this point.

Re: World's richest 500 see their wealth increase by $1T this year

#152

Post by dbingham »

Danihan wrote: post #130
volgo wrote: post #126

As capitalism matures, it's clear to anyone with a thread of financial literacy that most wealth is created through capital gains rather than salary. We're approaching a state (at least in developed countries) where productivity is so high, that you can literally park your money in 500 of the biggest businesses and you're almost guaranteed a 7% annual return (if you hold stocks for the long term). Using the commonly…

I agree with much of what you said, yet I just don't see it as all that bad of a situation. I still think there is a lot of upward mobility even in that scenario -- the smarter people I know earn good salaries and have nice lifestyles. Nicer than their parents, in most cases, mainly because consumer technology constantly gets better and cheaper. And there is still opportunity for risk takers to start their own compan…

We're already in this situation and the data do not entirely agree with your anecdotes. Social mobility is quantifiably dropping. And that's a problem.

[1] https://www.theatlantic.com/business/archive/2016/07/social-...

Re: World's richest 500 see their wealth increase by $1T this year

#153

Post by dragonwriter »

AnimalMuppet wrote: post #141
dragonwriter wrote: post #34

Earlier quoted context omitted.

If it is asymmetric, the superficially apparent mutual gain may be illusory, because—while many people think for moral or aesthetic reasons that this should not be the case—there is enormous empirical evidence that the actual experience of utility related to material position is very strongly driven by relative material position, which is often far more significant than absolute material position.

But is that empirical evidence talking about peoples' overall position, or their position with respect to one particular exchange? That is, it can be true that I feel rich or poor by comparing myself to others, not based on my absolute wealth. It can also be true that I look at any individual transaction and decide whether to make it or not based on whether it makes me better off in absolute terms.

> But is that empirical evidence talking about peoples' overall position, or their position with respect to one particular exchange?

It's about overall position, but the outcome of every particular exchange is a change to overall position; now, if the asymmetry in exchanges were essentially random, this wouldn't matter, but when you have a system with distinguishable classes, and there is a clear relationship between class role and which side of the asymmetry of exchange you tend to fall on across exchanges—say “capital” having the greater gain and “labor” the lesser—then you can end up with a situation where the pattern of exchange, each seemingly mutually beneficial but asymmetrically so, ends up producing more disutility from increasing inequality on one side than utility from absolute gain.

Re: World's richest 500 see their wealth increase by $1T this year

#154

Post by Danihan »

adventured wrote: post #147
volgo wrote: post #126

As capitalism matures, it's clear to anyone with a thread of financial literacy that most wealth is created through capital gains rather than salary. We're approaching a state (at least in developed countries) where productivity is so high, that you can literally park your money in 500 of the biggest businesses and you're almost guaranteed a 7% annual return (if you hold stocks for the long term). Using the commonly…

> it's clear to anyone with a thread of financial literacy That's argument from intimidation and not a valid form of argumentation. > In effect, late stage capitalism becomes the anti-thesis of the spirit of capitalism - devoid of competition, free innovation, and upward mobility Fortunately the world isn't in late stage Capitalism, because there is no such thing. As one obvious example, China has only begun to emerg…

- "Innovate or die"

Thanks for this post, pretty amazing to read through these.

Re: World's richest 500 see their wealth increase by $1T this year

#155

Post by malandrew »

JumpCrisscross wrote: post #115
notyourwork wrote: post #59

Earlier quoted context omitted.

Not to say I disagree because I do think the wealthiest should contribute meaningfully to society. But when you say "without visible contributions to society." why should an extremely wealthy person have to contribute to society?

> why should an extremely wealthy person have to contribute to society? If influence, specifically political influence, and wealth could be perfectly decoupled, no reason. That nexus, however, means an oligarchical class of rich idiots have the capability to project their stupidity onto national policy.

Poor idiots collectively have the capability to project their stupidity onto national policy as well. Maybe we should reduce the size and scope of national policy to minimize the impact of idiots, rich or poor.

Re: World's richest 500 see their wealth increase by $1T this year

#156

Post by knolan »

Danihan wrote: post #130
volgo wrote: post #126

As capitalism matures, it's clear to anyone with a thread of financial literacy that most wealth is created through capital gains rather than salary. We're approaching a state (at least in developed countries) where productivity is so high, that you can literally park your money in 500 of the biggest businesses and you're almost guaranteed a 7% annual return (if you hold stocks for the long term). Using the commonly…

I agree with much of what you said, yet I just don't see it as all that bad of a situation. I still think there is a lot of upward mobility even in that scenario -- the smarter people I know earn good salaries and have nice lifestyles. Nicer than their parents, in most cases, mainly because consumer technology constantly gets better and cheaper. And there is still opportunity for risk takers to start their own compan…

My parents had paid off their mortgage when they were my age. My father was self employed and my mother a housewife. I’m on a reasonably good salary but banks won’t loan us enough to buy an averaged sized family home even though we have a reasonable deposit. My partner would have to be on an equally sized salary but her teaching job pays very little.

Sure we have some nicer gadgets and personal comforts but the cost of accommodation and property has skyrocketed way out of proportion.

Re: World's richest 500 see their wealth increase by $1T this year

#157

Post by ouid »

JumpCrisscross wrote: post #115
notyourwork wrote: post #59

Earlier quoted context omitted.

Not to say I disagree because I do think the wealthiest should contribute meaningfully to society. But when you say "without visible contributions to society." why should an extremely wealthy person have to contribute to society?

> why should an extremely wealthy person have to contribute to society? If influence, specifically political influence, and wealth could be perfectly decoupled, no reason. That nexus, however, means an oligarchical class of rich idiots have the capability to project their stupidity onto national policy.

Even if they aren't projecting their stupidity, they're certainly projecting their interests. There's nothing preventing their interests from being at odds with society's interests.

Re: World's richest 500 see their wealth increase by $1T this year

#158

Post by hueving »

coliveira wrote: post #57
marcosdumay wrote: post #49

Earlier quoted context omitted.

It's way simpler. As population grows, the 500 richest people (whoever they are) are expected to get richer even if the wealth distribution does not change. And as the society gets richer, they are expected to get richer too. So, if there is any indication that wealth has been accumulating faster, it is not on the article. And as such, the article is valueless and a complete loss of time.

The indication you're searching for is called wealth inequality. It is a measure of how much more money the richest people have compared to the rest of the population, and it has increased significantly over the years: http://fortune.com/2014/10/31/inequality-wealth-income-us/ There is an economist called Thomas Piketty who has made his name by studying and measuring inequality over the years. Read his book and you w…

Can you explain why wealth inequality is bad?

If me and the rest the million other people in my city have $100,000, some billionaire in a city somewhere else making another 100 million doesn't really have any impact on me directly. Yet it increases this inequality metric and I'm supposed to be outraged.

If the billionaire was using this position to corner the real estate market I'm trying to buy a house in, then I might be upset. But, I could also pool 1,000 of my friends together each with our $100,000 into a corporation and corner a market as well.

So why exactly is inequality relevant? Shouldn't we be focused on just raising where the bottom of the income range is rather than cutting down the tall outliers?

It seems to me like trying to make yourself wiser by killing everyone with more education than yourself.

Re: World's richest 500 see their wealth increase by $1T this year

#159

Post by [deleted] »

knolan wrote: post #156
Danihan wrote: post #130

Earlier quoted context omitted.

I agree with much of what you said, yet I just don't see it as all that bad of a situation. I still think there is a lot of upward mobility even in that scenario -- the smarter people I know earn good salaries and have nice lifestyles. Nicer than their parents, in most cases, mainly because consumer technology constantly gets better and cheaper. And there is still opportunity for risk takers to start their own compan…

My parents had paid off their mortgage when they were my age. My father was self employed and my mother a housewife. I’m on a reasonably good salary but banks won’t loan us enough to buy an averaged sized family home even though we have a reasonable deposit. My partner would have to be on an equally sized salary but her teaching job pays very little. Sure we have some nicer gadgets and personal comforts but the cost…

[deleted]

Re: World's richest 500 see their wealth increase by $1T this year

#160

Post by MisterBastahrd »

notyourwork wrote: post #90
coliveira wrote: post #79

Earlier quoted context omitted.

People who do not contribute to society are what we call parasites. Just because your father or grand-grand-father did something useful to the world doesn't justify that you have to live like a king. Modern society destroyed the old feudal order exactly to avoid this kind of social injustice.

I completely agree that the richest should contribute to society, especially as someone in the middle class. However, let's pretend I was born into the wealthiest class. If I inherit a business, that business provides jobs (ie. wages) for people, and is a functioning part of the economic system. Does that mean I am not contributing? Regardless of how rich I am, I still need to eat and live and put clothes on my back.…

No, you aren't really contributing. That business existed without your ownership stake. You inherited it.
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