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Billionaires amass more through inheritance than wealth creation, says UBS

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Re: Billionaires amass more through inheritance than wealth creation, says UBS

#261

Post by rufus_foreman »

lapcat wrote: post #229
DennisP wrote: post #204

Earlier quoted context omitted.

I wasn't the one who called it clickbait but I do think it's misleading. The one year could easily be an outlier. It might be by accident, or it could be that the writer was more interested in pushing a political view than getting clicks.

> it could be that the writer was more interested in pushing a political view than getting clicks. The report comes from the Union Bank of Switzerland. https://www.ubs.com/global/en/media/display-page-ndp/en-2023... "UBS manages the largest amount of private wealth in the world, counting approximately half of the world's billionaires among its clients." https://en.wikipedia.org/wiki/UBS Also keep in mind that some of…

Buffet has said he is giving most of his money away. Same with Gates, Ellison and Bloomberg. Carlos Slim has also been donating huge amounts to philanthropies.

Re: Billionaires amass more through inheritance than wealth creation, says UBS

#262

Post by TacticalCoder »

lawn wrote: post #107
pmorici wrote: post #87

This doesn’t appear to breakout by country. This isn’t surprising for more socialist countries like in the EU where it is harder to start and build businesses (wealth) in general. I’d be surprised if it was the same in the US where studies have shown that the majority of wealth is not inherited.

This is a common sentiment, but surprisingly it's quite easy to start a business in a country with a more developed social net because the failure consequences are much less severe.

Which is why the FAANG and Microsoft and all the tech really comes from France right?

Re: Billionaires amass more through inheritance than wealth creation, says UBS

#263

Post by Sohcahtoa82 »

justinsaccount wrote: post #68
GreedClarifies wrote: post #30

Yet on the billionaire leaderboard the top-10 are: Musk, Arnault, Bezos, Ellison, Buffet, Gates, Zuckerberg, Balmer, Page, Bin. Not one of them through inheritance. Sure, you have the waltons a little lower on the list. As a person who started in the bottom decile of wealth I want to hate inheritance at least as much as the next person. But at first glance it sure doesn't look good for these "researchers".

Musk: Rich father, emerald mine money? Arnault: "In 1971, he graduated from the École Polytechnique, France's leading engineering school, and began work for his father's company. Three years later, after he convinced his father to shift the focus of the company to real estate" Gates: "His father was a prominent lawyer" "At age 13, he enrolled in the private Lakeside prep school, where he wrote his first software prog…

I genuinely find it absolutely infuriating that so many people actually think any of those people are self-made.

They all had rich parents that provided a massive safety net in case their ventures failed.

For over 90% of the country, if they quit their day jobs to try out some business venture, they'd be bankrupt within a few months just from living expenses, let alone business expenses. Half the country would probably be out on the street within weeks as they wouldn't be able to pay the rent.

57% of Americans can't afford a $1,000 emergency expense [0]. For these people, even if they didn't quit their day jobs, they'd have an extremely difficult time getting a business off the ground.

[0] https://fortune.com/recommends/banking/57-percent-of-america...

Re: Billionaires amass more through inheritance than wealth creation, says UBS

#264

Post by lapcat »

rufus_foreman wrote: post #261
lapcat wrote: post #229

Earlier quoted context omitted.

> it could be that the writer was more interested in pushing a political view than getting clicks. The report comes from the Union Bank of Switzerland. https://www.ubs.com/global/en/media/display-page-ndp/en-2023... "UBS manages the largest amount of private wealth in the world, counting approximately half of the world's billionaires among its clients." https://en.wikipedia.org/wiki/UBS Also keep in mind that some of…

Buffet has said he is giving most of his money away. Same with Gates, Ellison and Bloomberg. Carlos Slim has also been donating huge amounts to philanthropies.

We'll see what happens when they actually die. In any case, they're giving their money "away" to "foundations" controlled by billionaire families. The money is still inherited, and these foundations can be seen as tax shelters.

Re: Billionaires amass more through inheritance than wealth creation, says UBS

#265

Post by rrrrrrrrrrrryan »

jhp123 wrote: post #254
kasey_junk wrote: post #69

Earlier quoted context omitted.

This is a stat that is never sourced and is mostly cited by the wealth planning industry that have an ulterior motive for making people believe it. I’d love to see a rigorous backing of this stat.

A study of British surnames found that those families descended from Norman nobility (e.g. D'Urberville) from the 11th century Domesday Book are wealthier than those with common names (e.g. Darbyfield) today , almost 1000 years later. https://www.theguardian.com/society/2011/apr/03/social-mobil...

Yes, the aristocracy is very much still alive and well in England.

Since America's founding, she's has had a bit more success pushing back against the concept, but our new aristocracy has definitely been grabbing a greater share of societal power as of late.

Re: Billionaires amass more through inheritance than wealth creation, says UBS

#266

Post by abeppu »

AnthonyMouse wrote: post #209
abeppu wrote: post #59

Earlier quoted context omitted.

I also think it's worth calling out that his follow-up, "Capital and Ideology" in its latter sections includes several suggestions for counteracting the trend to increasing inequality. One of these is basically that _every_ person should have a windfall inheritance when they're in their early adulthood, which would give them opportunities to pursue education, try starting a business, or whatever else. And naturally,…

> And naturally, this needs to be funded by taxes on the very wealthy. This is the part where the math never works out. If you look at the richest people, they have something like tens to low hundreds of billions of dollars. Which is less than the amount of money the federal government already spends every week. If you taxed the top 100 billionaires at a rate of 100%, it would fund the existing federal government (an…

Of the criticisms to Piketty, not having done the math isn't really one of them.

I don't have Capital and Ideology close at hand, so I can't check how he worked it out, but consulting some other sources:

- the top 1% in the US apparently have around $45.7T in wealth [1]

- there are around 22M people in the 20-24 age bracket and 23 in the 25-29 age bracket [2]

So suppose there are 5.5M people turning 21 every year. Giving them each $100k (yes, less than the Piketty proposal for the EU, but in the ballpark, and gives us round numbers) would cost $550B/yr at present. If this were funded as a flat wealth tax only on the top 1%, it would amount to around a 1.2% wealth tax, not accounting for evasion etc. So literally, 99% of the population could pay more in taxes, the 1% would be taking a hit, but honestly so long as long-term average returns are more than 1.2% above inflation, you could still have inter-generational wealth that gets bigger over time.

Of course, many would naturally prefer for a wealth tax to be progressive; the ultra-rich should pay a larger share than the pretty-rich. This would have the impact of shrinking long term dynastic piles of wealth, but not fully eliminating them, and reducing the impact on people at the low end of the 1%.

[1] https://www.federalreserve.gov/releases/z1/dataviz/dfa/distr...

[2] https://www.neilsberg.com/research/datasets/5fd2b2bb-3d85-11...

Re: Billionaires amass more through inheritance than wealth creation, says UBS

#267

Post by pmorici »

skyyler wrote: post #174
pmorici wrote: post #145

Earlier quoted context omitted.

Your link shows the United States out ranking Norway, Sweden, and Finland on their ease of doing business score which appears subjective compared or hard numbers of successful businesses. Are you sure you read that page right?

The discussion was about "starting a business" which is also a metric on that site. The US ranks 55th in that category.

It was about building wealth through starting a business.

Re: Billionaires amass more through inheritance than wealth creation, says UBS

#268

Post by tanjtanjtanj »

uoaei wrote: post #138
pydry wrote: post #131

Earlier quoted context omitted.

I prefer to call it wealth re-re-distribution. The Walton family wealth, for example, is a capitalised stream of rents predicated on underpaying store staff and abusing market power with suppliers. That's a wealth transfer. That's redistribution. The Duke of Westminster is worth $11 billion because his ancestor was besties with William the Conqueror (not william the earner). These are wealth transfers and redistribut…

Distribution implies few to many, concentration implies many to few. We could call it semantics or we could call it using words correctly.

I don't have that connotation for the word and I'm not sure I can find support for it either.

If I have 5 objects and five people and I give one to each that's a distribution. If I give them all to one person, that's a distribution. If I start with the first distribution and concentrate all of the items to one person, creating the second distribution that's still the same distribution.

Re: Billionaires amass more through inheritance than wealth creation, says UBS

#269

Post by somewhereoutth »

zozbot234 wrote: post #208
ambientenv wrote: post #202

Earlier quoted context omitted.

This feels true to me. So my question is - and I don't know the answer yet, though I continue to seek such - when do we, as a humanity, break this cycle? When, and how, do we override the greed impulse, the impulse for power and control and domination of others? When do we begin to leverage a superior cognitive capacity enough to gain true enlightenment and break free from the bonds of behaviour which, while necessar…

We are pretty much there already. The average person in a developed Western country is pretty much a billionaire when compared to the living conditions of even the wealthiest people in ancient history. It's only the impulse of greed and envy towards others that leads us to believe otherwise.

Not quite. Some things are fundamentally restricted in supply - for example and most pertinently, decent housing where people need to live. It is hard to feel like a billionaire when you have to share cramped living spaces that take most of your income.

Re: Billionaires amass more through inheritance than wealth creation, says UBS

#270

Post by pmorici »

AnimalMuppet wrote: post #255
pmorici wrote: post #77

Earlier quoted context omitted.

If you think about it in terms of what kind of income you would make off interest of ~3% of the principal it’s easier to understand the difference between someone with 5 million vs say 50 and 500 million. It’s the difference between $150k, $1.5 million, and $15 million dollars in yearly income. At 5 million you can decide to not work but you are only really able to afford an upper middle class lifestyle. Depending on…

You think $5 million a year only gets up upper middle class lifestyle? I don't think we share definitions...

That’s 5 million in assets from which you can derive a yearly income of $150k per year adjusted for inflation as time goes on.

Yes I consider 150k per year upper middle class.

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