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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

#341

Post by iNic »

burkaman wrote: post #221
iNic wrote: post #196

Earlier quoted context omitted.

It turns out the thing that Picketty missed was that he grouped land with Capital. Land should be treated differently as it can not be created or destroyed. If you seperate out the data into land and capital (w/o the land) then all of the outsized returns come from rich people hoarding land[1]. This is in line with the observations of Riccardo[2]. [1]: https://www.salon.com/2015/01/02/joseph_stiglitz_thomas_pike... […

Sorry if this is nitpicking, but valuable land absolutely can be created (Boston) and destroyed (climate change) on human timescales. I'm sure the amount of land that can realistically be created and destroyed within a few lifetimes is negligible compared to the amount of land in existence, but compared to valuable inhabited land it might actually be significant. Coastal land tends to be pretty valuable, and that's w…

Yeah, I'm talking about land in the Henry George sense. Maybe a better word would be "natural resources". In this framework you don't just have Labor and Capital, but you have Labor, Capital and Land. Labor uses Land to create wealth, and Capital gives Labor the tools to be more effective in wealth creation.

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

#342

Post by nvr219 »

Ekaros wrote: post #47
nvr219 wrote: post #29

Earlier quoted context omitted.

It's very funny to see Rothschild described as "secretive"; I thought they were one of the most well-known families in the world or at least in Europe.

How many of them an average person can name? And how many of those are still alive? Name is known, but I don't think they are as individuals known very much at all.

I don't know any of their first names but I also can't name the first names of any other well known wealthy families (off the top of my head walton, koch (I just know they are "Brothers"), dupont, bush)... I don't need to know the first names to know the families are billionaires

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

#343

Post by jhp123 »

somenameforme wrote: post #335
jhp123 wrote: post #254

Earlier quoted context omitted.

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...

That is not quite what your article says. The researcher found that if you look at the period of time after 1850, people with rich surnames earn about 10% more than people without, although the differences narrow rapidly each generation. He then observed that if you go back to the Mid-ages and before, such convergence to the mean took a comparable amount of time. The example he uses is "Smith", which tended to be the…

well you can read the study directly, the Guardian summary seems to be pretty poor if it's giving you the sense that differences narrow rapidly each generation — the study found social status is as heritable as height and can persist for 20 generation or more: https://eprints.lse.ac.uk/54515/1/WP181%20revised.pdf

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

#344

Post by kajecounterhack »

jay_kyburz wrote: post #329
kajecounterhack wrote: post #306

Earlier quoted context omitted.

I think the point is that humans need a lot of infrastructure to live. Reliable water/sewage, internet connectivity, schools / day cares if you have kids, access to healthy food (google "food deserts"), etc.

Ahh, no, I think there is an interesting question here, can a young person today go out west and build all that stuff from nothing. (Like people did a few hundred years ago) Can you buy a small parcel of land, dig a well for water and a hole under the outhouse, plant veggies, have some chickens, pigs, perhaps a goat. Can you do it in range of a cell tower for internet, do you need some satellite solution. How much so…

> can a young person today go out west and build all that stuff from nothing. (Like people did a few hundred years ago)

Maybe a specific young person with a lot of relevant experience and strong desire for this sort of life could, but it would be pretty hard and the initial costs are nothing to sniff at.

Water is especially prohibitive. The American West is going through massive aridification and the water table is overdepleted in many places. Gotta watch out for water rights too.

Electricity and internet are doable if you can afford the right systems.

Food is really hard unless you're willing to buy everything at dollar general. Modern farming is highly reliant on artificial sources of nitrogen. And it's just not a good use of your time if you have a tech job. Social needs of humans cannot be overlooked.

People even a couple hundred years ago would move whole communities. They had access to abundant natural resources and divided responsibilities differently.

Maybe you're just interested in van life but + farming? It's expensive and probably a bad investment overall, but makes more sense than owning random cheap but poorly situated land outright.

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

#345

Post by snapplebobapple »

ambientenv wrote: post #202
sidewndr46 wrote: post #166

Earlier quoted context omitted.

Overwhelmingly, violent revolution doesn't actually bring about the goals of the revolution. It just installs a new power structure with variations on all the old problems. Sometimes much worse. So it isn't really a "last resort". It's more of a "well you didn't compromise, so now our choice is to burn the whole system down"

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…

You don't. Biology is a weird and wonderful thing and all these behaviours are ingrained deep. You arent changing anythibg without likely making it way worse through unforeseen outcomes. What we have to do instead is harness these emotions for financially wiping out the weak wealth inheritors mich more effectively so that it is rare to get more than 3 or 4 generations of these people with no skill growing the pot. One generation of imbecile/useless person needs to be likely to wipe out the pot.This would take the form of such things as (but not limited to) drastically limiting the controls one can keep on inheritances through time so more money ends up in inheritors hands with no restrictions sooner, finding a way to make private equity mich riskier/more evemly allocated so that the expected return for rich people is lower (but skilled rich can still earn high returns), more effectibely limiting corporate market power abuse by more effectively breaking up oligopolies (dont have to go back to prerehnquist levels of trust breaking but need to jead back in that direction some), etc.

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

#346

Post by mantas »

abeppu wrote: post #123
zozbot234 wrote: post #82

Earlier quoted context omitted.

So he supports education vouchers and healthcare vouchers for everyone? Because that's what "wealth you can spend down for some specific purposes" is , in a practical sense. That's a welcome attitude, given that these things are often dismissed ideologically. (Also, we generally want people to have some retirement income in their old age when they can't work, and the goal of letting young folks spend down their "inhe…

I think that muddies the water as much as saying that someone who supports UBI also must support foodstamps and housing vouchers. The point is pursuing greater _equality_. We are all heirs to a society that has produced enormous value; why should a small minority of kids get a huge extra unearned boost? Purpose-constrained assistance is not _equal_ to inheritance, in that heirs to private wealth aren't generally subj…

> why should a small minority of kids get a huge extra unearned boost?

This is what gives incentive. You do your best, next generation of your genes lives better. If you muddy that connection too much, you got 2 problems on your hands. Some leachers will try to freeride. And some people will stop earlier than they code since they don't see incentive to work more for little gain for their direct descendants.

IMO USSR was a great case study for this. Building wealth was very limited, especially in allowed ways. Thus many people just stopped caring. Do as little as you can to pass by. Drink your days aways. The state will take care of your and your kids basic needs anyway. If you work your ass off - there will be very little change to you and your kids. Unless everybody works their asses off. But turns out in such cases mass apathy wins. And society crumbles.

For the record, I do support free education. And it must be as high quality as possible. You don't want to waste talent because it was born in a poor family. But there needs to be plenty of incentive for that talent to do their best. And inheritance-heavy wealth structure doesn't ensure that either.

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

#347

Post by majani »

kasey_junk wrote: post #69
IAmNotACellist wrote: post #33

And yet 70% of generational wealth is gone by the 2nd generation.

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.

It's intuitive. 1st generation, 3 children. They each marry and have 3 kids each. Those are now 15 people with a direct "right" to the wealth. Third generation all marry and have 3 kids each as well, now you have 51 people with a direct claim to the wealth. The family has grown from 2-51 in one lifetime, that's a 25x growth rate. But the trust money is probably in safe, boring investments that grow at modest rates, so the growth rate of the family simply outpaces that of the money over time to the point where it becomes trivial for the family members to piss it away

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

#348

Post by carlosjobim »

lotsofpulp wrote: post #289
carlosjobim wrote: post #286

Earlier quoted context omitted.

Discrediting a website just because of the name is not a valid argument against the content. Even though most hackers worship the government as a god, I can assure you that tax returns or property data won't even be close to accurate for getting the net worth of billionaires. They have funds and shell companies where the US government can't touch them. The nature of this information is that it will always be unverifi…

> Even though most hackers worship the government as a god, I can assure you that tax returns or property data won't even be close to accurate for getting the net worth of billionaires. I know, that is why I wrote “might” be credible, but most celebrities are not at that level, so tax returns and property ownership information might work. > The nature of this information is that it will always be unverifiable, >you s…

> How you are squaring the above 2 thoughts is beyond me.

A late reply so might not be seen, but that is what we as humans have to do every day. If you're in highly competitive business or if you're investing, it is just a fact that information you get will be unverifiable. You just have to act on the information you have, to your best judgement. It's even worse in politics and in war, where you have to expect active disinformation from every angle.

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

#349

Post by [deleted] »

AnthonyMouse wrote: post #339
andrewjl wrote: post #304

Earlier quoted context omitted.

The math doesn't work out by design due to favorably shaped policies. A sizable amount of wealth is hidden away extra-jurisdictionally or consists of intentionally undervalued assets or isn't captured in statistics.

Lots of very wealthy people keep wealth in tax shelters, but that reduces their tax burden, not their net worth. Bill Gates doesn't secretly have a trillion dollars.

[deleted]

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

#350

Post by tokai »

pmorici wrote: post #267
skyyler wrote: post #174

Earlier quoted context omitted.

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.

If you can't keep track of your own words, there is no reason to pester other with them.
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