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Wealth Shown to Scale

mkorostoff.github.io

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Re: Wealth Shown to Scale

#21

Post by pydry »

iratic0 wrote: post #7

Nice graphic, but also a bit misleading. Bezos would never be able to immediately realise that amount of assets in to useful cash. So saying no human deserves this amount of wealth is kind of already fulfilled? He may have 2 or 3 billion as cash maybe.

>Bezos would never be able to immediately realise

Why would he want to? Who tries to spend 100 billion all at the same time? Nobody wants 100 billion in cash in their bank account either.

I think you're confusing liquidity and wealth.

Re: Wealth Shown to Scale

#22

Post by dredmorbius »

iratic0 wrote: post #7

Nice graphic, but also a bit misleading. Bezos would never be able to immediately realise that amount of assets in to useful cash. So saying no human deserves this amount of wealth is kind of already fulfilled? He may have 2 or 3 billion as cash maybe.

I agree to an extent with this view, though the reality is complicated.

The wealth of the ultra-wealthy doesn't exist in bank accounts or vaults of gold, but in assets, and largely assets which have appreciated. The $13 billion dollar single-day appreciation in Bezos's wealth wasn't from someone cutting him a check, but as a result of an increase in the value of his holdings (largely Amazon, Inc., stock).

And liquidating those holdings would not result in receiving the full closing-bell price for that day --- a movement the size of Bezos's on the market would itself influence the price. (A very similar situation exists for other novel assets, notably cryptocurrencies, whose "market value" is something of a polite fiction.)

At the same time ...

... the ultra-wealthy can excercise their wealth without liquidating or spending it, largely by using it as collateral against loans or for investments in other areas. At sufficient scale, the mere threat of making a move in some direction (investing in an industry or market or backing a politician, party, or legislative initiative).

In both instances, the key point is that money doesn't behave at these scales as most people reading this are given to understand. Much as with relativistic physics and quantum mechanics, our quotidian experiences don't give us the proper intuition for these phenomena.

Re: Wealth Shown to Scale

#23

Post by vishnugupta »

I'm learning economic concepts so some of my notions and questions end up being naive. Would appreciate if someone could clarify/answer this.

It's a fair guess that vast majority of Bezos's wealth is in Amazon equities. Which are valued as such by the participants in US equity market. A thought exercise, what would happen if he were to liquidate all of that $180+B in equities? Safe to say he will get less than $180B in cash that could he could use for charities, moonshot projects etc.,

There's also a matter of confidence. How will the markets react if the founder of Amazon were to liquidate his Amazon holdings? So it seems to me that not all of his wealth is usable. Does it mean we need better ways of gauging wealth? Especially when trying to assert things like "X% of his wealth is enough to house all homeless veterans for an year". His wealth is locked up in some form which though is valued in USD won't translate 1-1 to other forms of wealth.

Re: Wealth Shown to Scale

#24

Post by dredmorbius »

ekianjo wrote: post #16

Erm, how about the wealth/money controlled by the Federal government? That's much bigger than anything shown here.

And, in theory at least, belongs to and serves the people as a whole.

Not one single solitary exclusive and extraordinarily privileged human being.

Re: Wealth Shown to Scale

#25

Post by dillondoyle »

kortilla wrote: post #17
bb123 wrote: post #12

I disagree on the the thrust of the argument - that people (including comparatively wealthy individuals like doctors and lawyers) oppose changes to tackle wealth inequality because they don’t understand the gulf of wealth between them and the ultra rich. In my experience it has nothing to do with that - rather these people know that they will ultimately end up as the main target for any such law, not these billionair…

This is absolutely it. Any taxes on just the ultra wealthy raise so little money for the rest of the population that any large scale money raising requires taxes on doctors, lawyers, engineers, small business owners, etc. Pro-government spending advocates don’t like to emphasize this because people become a lot less supportive of these things when they see members of their own community getting hit.

I would say rhetorically that ex post facto (am i using that right? kind of like caused by definition) taxes on the ultra wealthy that don't achieve that aren't actually taxes that target the ultra wealthy, but rather just marketing.

I think Biden has tried get ahead of that issue with his no higher taxes on 400k pledge. We'll wait to see the reality though.

Re: Wealth Shown to Scale

#26

Post by sidcool »

sooheon wrote: post #19

The rich aren't the enemy, rent-seekers are. They may overlap, and Bezos may be both, but wealth and capital on their own are orthogonal to justice. https://pbs.twimg.com/media/EHKZRLcW4AA1aju?format=jpg&name=...

Genuine question. Ia rent seeker being used as a metaphor here?

Re: Wealth Shown to Scale

#28

Post by pydry »

vishnugupta wrote: post #23

I'm learning economic concepts so some of my notions and questions end up being naive. Would appreciate if someone could clarify/answer this. It's a fair guess that vast majority of Bezos's wealth is in Amazon equities. Which are valued as such by the participants in US equity market. A thought exercise, what would happen if he were to liquidate all of that $180+B in equities? Safe to say he will get less than $180B…

You're hypothesizing that he might want to spend 180 billion dollars in a single day?

If you don't assume that it makes no sense to assume he'd want to liquidate it all at once.

Liquidity != wealth

Illiquid wealth != unreal wealth.

It's really odd how many people seem to have been led to believe it is equivalent though... I'm curious to know where they all picked up this misconception.

Re: Wealth Shown to Scale

#29

Post by chrisco255 »

albertgoeswoof wrote: post #10
iratic0 wrote: post #7

Nice graphic, but also a bit misleading. Bezos would never be able to immediately realise that amount of assets in to useful cash. So saying no human deserves this amount of wealth is kind of already fulfilled? He may have 2 or 3 billion as cash maybe.

There are many, many ways that wealth is realized without spending it. Once you get past a few hundred million you literally cannot spend the money as fast as it comes in. These billionaires aren't amassing wealth to spend it on things, they're gathering it for power, leverage, status, prestige, legacy reasons etc, and using it to influence and control the world to further their own agenda.

In Bezos's case, he built a company that literally didn't even exist 27 years ago. It's gotten so huge, because globalization has gotten so effective. That's true of all tech companies: they benefit disproportionately from globalization and network effects.

As far as what to do about it? The only solution could be to break up Amazon, Google, Apple, etc. Taxation is not it. The Federal government and the Fed controls the money printer and influences how high these stock valuations are getting. They're a large part of the problem.

We can't print trillions of dollars without side effects in supply, demand and price mechanics. In this case, dollars are chasing productive growth assets as yields in bonds hit the floor and go under zero in some countries.

The growth in inequality correlates with the growth in the national debt, and monetary supply growth.

Re: Wealth Shown to Scale

#30

Post by iamgopal »

vishnugupta wrote: post #23

I'm learning economic concepts so some of my notions and questions end up being naive. Would appreciate if someone could clarify/answer this. It's a fair guess that vast majority of Bezos's wealth is in Amazon equities. Which are valued as such by the participants in US equity market. A thought exercise, what would happen if he were to liquidate all of that $180+B in equities? Safe to say he will get less than $180B…

Also factor in his capacity to raise more fund. Tomorrow if he go public with his space company, his wealth will increase
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