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Who Rules America: An Investment Manager's View on the Top 1%

sociology.ucsc.edu

131–140 of 207 posts

Re: Who Rules America: An Investment Manager's View on the Top 1%

#131

Earlier quoted context omitted.

Let's think about secondary effects. What percent of very wealthy Americans do you think would renounce their citizenship based on this? How much less investment capital would there be in the USA based on that? Note: Not asking for a value judgment ("good riddance if they do!" - not productive). Just your estimate as to what percent of wealthy Americans would give up their citizenship and how much less investment cap…

For those of you responding skeptically to Lionhearted's question, I'm in the business of helping these people exit the United States. At any given point I have four or five of these cases going. They go everywhere. Their money goes with them.

But for every one of those wealthy Americans who is looking for a way out there is at least one wealthy person, if not ten, from China, Malaysia, South Africa, well, as you say, everywhere - looking for a way in to the US.

Their money comes with them.

We live in a global economy, however the number of doors or opportunities that are opened to you is related to how wealthy and/or educated you are.

Re: Who Rules America: An Investment Manager's View on the Top 1%

#132

Earlier quoted context omitted.

You say "in direct contradiction to the last 80 years of economic thought", but we have not been off of gold and on fiat for that long, more like 40 years IIRC. Even the swiss franc was pegged to gold until 2000. The Fed is getting pretty limited to what it can do by lowering rates. With only 6% more unemployment, we would be at 1870s levels (completely unmanageable)? Calling it counterfeiting is a bit extreme, thoug…

Gold was criminalized for use in transactions in 1933 by executive order. I think that's a fair point to mark the end of the "gold standard" and the beginning of the fiat era. It is true the US government would redeem dollars for gold for foreign countries up to 1970 or so, under Nixon... but indie the USA, it was a crime to use gold as money. (Though jewelry was allowed) up until the 1970s. He's using the term "coun…

Money is a medium of exchange, unit of account, and store of value.

Those are the only requirements for money.

Re: Who Rules America: An Investment Manager's View on the Top 1%

#133

Earlier quoted context omitted.

The total number for 2009 was 743, though, which is pretty small peanuts by the scale of the U.S. economy. It's not even large as a proportion of very-rich people.

That's the number of people who renounced. And that number is going up dramatically, and I've heard that the published figures for renouncement are way under-reported. (as in here are lawyers who have more clients who have renounced than the government claims renounced in total.) But on both sides these are just claims. The number of people who simply moved their butts and their assets overseas is much higher. You ca…

Yeah, I'd support making it both easier to leave the U.S. as well as to enter it--- make both renunciation and green-card procurement easier. I think the U.S. would come out pretty well on overall balance there, because it's a fairly popular place to live, and is artificially keeping out many people who would like to live there.

The evidence I can find is that the outward flow is a trickle rather than a flood (or even a modest current), though. Even if the 743 number is a 5x underestimate, that's still not much. I'm not sure it even balances the rich people flowing the other direction, e.g. the businessmen getting green cards under the ">$1m to invest" criterion (and no doubt there would be more of them if the green-card process were streamlined).

I don't think the U.S. is particularly unique in making it hard to renounce citizenship, though perhaps it's for different reasons. Many countries make it very hard to renounce citizenship if they think you're doing it to get out of mandatory military service, for example. For economic reasons, many require that there no longer be any links with the country, e.g. you can't renounce German citizenship if you still own businesses or property in Germany. France seems to have an additional timing requirement, where you can only renounce French citizenship within the first year after acquiring a second citizenship, so dual nationals can't decide 10 years later to leave the country and renounce the French citizenship.

Re: Who Rules America: An Investment Manager's View on the Top 1%

#134

Earlier quoted context omitted.

Let's think about secondary effects. What percent of very wealthy Americans do you think would renounce their citizenship based on this? How much less investment capital would there be in the USA based on that? Note: Not asking for a value judgment ("good riddance if they do!" - not productive). Just your estimate as to what percent of wealthy Americans would give up their citizenship and how much less investment cap…

Echoing what rayiner said - where are the rich going to go? Europe is less friendly to the rich - extremely so in the most pleasant of places. China? India? Neither are very pleasant places, and even with truckloads of cash has a hard time competing with the quality of life enjoyed in the US even under onerous taxation. I think you're not giving enough credit to the American quality of life - it's why my family immig…

There are many places an american can go. Unlike the USA, most countries don't tax your worldwide income. So, for instance, you could become a citizen of any of the EU countries that don't tax worldwide income, and earn your income outside that country tax free (and live outside it as well.)

I know of several countries within the EU where you can be a citizen and pay essentially no taxes, or extremely low taxes. These are very pleasant places as well. For instance, one location is the side of a very nice lake in switzerland (Campoin d' Italia) and Andorra has some nice tax advantages, and one of the best climates in Europe. Monaco is not bad, though expensive for my tastes, while Licthenstein, Austria, Switzerland, and all this british islands whose existence is for purposes of avoiding taxes aren't too bad either.

The idea that you can't have a high quality of life in China or India compared to the USA seems silly to me, but I haven't lived in either of those countries. There are many countries in Latin, South America, Asia and Europe where you can have as high a quality of life as the USA, or higher, and at much less cost than the USA.

I think the idea that anywhere desirable is worse than the USA is a kind of parochial perception. Of course ones preferences can vary, but, for instance, in many ways much of eastern europe is nicer than the USA, even though they are "poorer". There are many countries that are in many ways richer, or where you can have a better quality of life at the same or less cost.

I just think that people in every country believe that their country s superior to others, and can't imagine how anyone would want to live in another country... but they also haven't experienced those other countries.

I've visited a lot of countries, and have yet to visit one that was terrible, and about %50 of them are better than the USA in noticeable ways, and the ones that aren't as good, aren't as good in ways that aren't really all that bad.

Re: Who Rules America: An Investment Manager's View on the Top 1%

#135

Earlier quoted context omitted.

Echoing what rayiner said - where are the rich going to go? Europe is less friendly to the rich - extremely so in the most pleasant of places. China? India? Neither are very pleasant places, and even with truckloads of cash has a hard time competing with the quality of life enjoyed in the US even under onerous taxation. I think you're not giving enough credit to the American quality of life - it's why my family immig…

That's not true. How about Hong Kong or Singapore where you certainly get a western style life with extra benefits: safer, cleaner, live-in maid service, better access to healthcare and a 15-20% all in tax rate. Have you been to Thailand or Indonesia? Sounds ridiculous but this is happening right now. I'm in banking and I hear my clients talk about it all the time. They're doing it as we speak (slowly migrating their…

Good Point.

For instance, New Zealand. Nice place. Great People. First class quality of life-- better than the USA. Higher taxes than the USA in many ways, but the government is so much less corrupt that the taxes are much less of a burden. You don't mind paying when you see you're getting value for the money.

Re: Who Rules America: An Investment Manager's View on the Top 1%

#137

The author of this article seems to be trying to confuse things: Membership in this elite group is likely to come from being involved in some aspect of the financial services or banking industry, real estate development involved with those industries, or government contracting. What does "involved in some aspect" mean? ...built a small company and was acquired with stock from a multi-national. Stock is often called a…

All of the people in the examples made money as salaried financial services employees or through stock. So for example, the programmer didn't make her money from selling her programming products; she sold her stock, a financial instrument.

Re: Who Rules America: An Investment Manager's View on the Top 1%

#138

Earlier quoted context omitted.

Gold was criminalized for use in transactions in 1933 by executive order. I think that's a fair point to mark the end of the "gold standard" and the beginning of the fiat era. It is true the US government would redeem dollars for gold for foreign countries up to 1970 or so, under Nixon... but indie the USA, it was a crime to use gold as money. (Though jewelry was allowed) up until the 1970s. He's using the term "coun…

Money is a medium of exchange, unit of account, and store of value. Those are the only requirements for money.

> Those are the only requirements for money.

Obviously they are not. The requirement that it should be difficult to duplicate is essential.

Re: Who Rules America: An Investment Manager's View on the Top 1%

#139

It makes perfect sense that most people in the top 0.1% are associated with the financial and banking industries if you know how banks work. Banks, and the Federal Reserve, create new money. They give this money to themselves, and then loan it out. This is as bad as, and effectively equivalent to, counterfeiting. Creating new money, i.e. counterfeiting, i.e. inflation, does not create new wealth. It merely changes th…

You say "Banks, and the Federal Reserve, create new money". That is factually untrue: only the Federal Reserve can legally create new money in the US. Since you mentioned it by name, you are definitely talking about the US, but the same state holds in virtually all developed countries as well: one designated "central bank" entity creates money, the others don't. Per your main point, yes, the central bank creates mone…

> That is factually untrue: only the Federal Reserve can legally create new money in the US

That is factually untrue: Changes in the quantity of money may originate with actions of the Federal Reserve System (the central bank), depository institutions (principally commercial banks), or the public... The actual process of money creation takes place primarily in banks

http://en.wikisource.org/wiki/Modern_Money_Mechanics/Introdu...

Re: Who Rules America: An Investment Manager's View on the Top 1%

#140

Earlier quoted context omitted.

Money is a medium of exchange, unit of account, and store of value. Those are the only requirements for money.

> Those are the only requirements for money. Obviously they are not. The requirement that it should be difficult to duplicate is essential.

Well, maybe that falls out from money being a "store of value".
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