Monday, June 02, 2014

The Rich, the Really Rich, and the Really Really Rich

The rich are back in a big way having recovered from the recession. And it's not just the 1%. It's the ultra rich -- the top 0.01% of earners.

In the mid-1980s the ultra rich -- those with a net worth of over $100 million -- owned just over 4% of the total wealth in the United States, according to a recent paper by University of California Berkeley economists Emmanuel Saez and Gabriel Zucman. By 2012, their share of the wealth nearly tripled, jumping to roughly 11%.

Those worth between $20 million and $100 million have seen their wealth share nearly double, while the merely rich -- those with wealth between $4 million and $20 million had a small improvement.

The other 99% of households saw a relative decline in wealth.

"The higher you are in the income distribution, the greater the gains," said Branco Milanovic, a visiting professor at the City University of New York and an expert on income inequality. "People who are poorer haven't really benefited from the expansion."

Many think it's because the wealthy enjoy low tax rates. But blaming tax cuts for this concentration is far too simple. Globally, the trend has been similar, and is expected to accelerate in the years to come. The ultra rich around the world are expected to see their wealth grow by over 9% a year between 2012 and 2017, according to the Boston Consulting Group. There are over 3,000 of these $100 million-plus households in the United States alone.

One thing is clear - The richest have a massive amount of money, and they're getting more of it every day.

From here

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