Key Points

  • The wealth of the top 1% hit a record $44.6 trillion at the end of the fourth quarter.
  • All of the gains came from stock holdings thanks to an end-of-year rally.
  • Economists say the rising stock market is giving an added boost to consumer spending through what is known as the “wealth effect.”

The wealth of the top 1% hit a record $44.6 trillion at the end of the fourth quarter, as an end-of-year stock rally lifted their portfolios, according to new data from the Federal Reserve.

The total net worth of the top 1%, defined by the Fed as those with wealth over $11 million, increased by $2 trillion in the fourth quarter. All of the gains came from their stock holdings. The value of corporate equities and mutual fund shares held by the top 1% surged to $19.7 trillion from $17.65 trillion the previous quarter.

While their real estate values went up slightly, the value of their privately held businesses declined, essentially canceling out all other gains outside of stocks.

  • gAlienLifeform@lemmy.world
    link
    fedilink
    arrow-up
    64
    arrow-down
    2
    ·
    7 months ago

    We just shouldn’t allow individuals to have over a billion dollars, just 100% tax on anything over a billion when combined assets exceed that number. Both because there’s no good reason for any one person to have that much money and because as pathetic as American campaign finance laws are it’s a legit national security risk for someone to have that kind of money to throw at their pet causes.

    • Flying Squid@lemmy.world
      link
      fedilink
      arrow-up
      42
      ·
      7 months ago

      I would lower that to $100 million. I don’t think there’s even a good reason for anyone to be that rich, but if we’re going for a crazy upper limit…

        • vithigar@lemmy.ca
          link
          fedilink
          arrow-up
          9
          ·
          7 months ago

          I would love to hear which “certain goods” are so expensive that one hundred million dollars is insufficient for a lifetime.

            • Flying Squid@lemmy.world
              link
              fedilink
              arrow-up
              10
              ·
              7 months ago

              You mean cars built specifically for rich people that absolutely no one needs to own? Because you probably can’t own an indoors swimming pool coated in 24 carat gold and the entire pool filled with water with gold flakes suspended in it for under $100 million either. Who gives a fuck?

              Rich people can drive Toyotas and Chevys like everyone else. They could even afford a Porsche.

              You’re not making a very good argument.

                • Flying Squid@lemmy.world
                  link
                  fedilink
                  arrow-up
                  1
                  arrow-down
                  1
                  ·
                  7 months ago

                  Yes.

                  Also, if you are worth $100 million, you can literally afford the most expensive cars ever made and still be a multimillionaire.

                  Now, please explain why anyone in this world needs a $30 million car and why it would be a hardship for someone who would still have $70 million after buying it.

                  • postmateDumbass@lemmy.world
                    link
                    fedilink
                    arrow-up
                    1
                    arrow-down
                    1
                    ·
                    edit-2
                    7 months ago

                    Because those cars bring new technology to the world.

                    They are vehicles for innovation.

                    They inspire people involved in making that car to be better at their jobs, to push the envelope.

                    Wealth does not trickle down, but technology does.

                    And if you want to put a legal limit on innovation and invention, thats an issue.

                • Flying Squid@lemmy.world
                  link
                  fedilink
                  arrow-up
                  12
                  ·
                  edit-2
                  7 months ago

                  That isn’t even remotely the same as communism. That is capitalism with an upper income limit.

                  You don’t have some people earning $100 million a year and others making $25,000 a year under communism. That’s only possible in a capitalist economic structure.

                  Your understanding of communism is on par with that of Joseph McCarthy.

                • _tezz@lemmy.world
                  link
                  fedilink
                  arrow-up
                  3
                  ·
                  7 months ago

                  Please stop commenting on politics if this is your level of education on the matter. Communism is absolutely not relevant here, because communism is

                  a socioeconomic order centered around common ownership of the means of production, distribution, and exchange that allocates products to everyone in the society based on need. A communist society would entail the absence of private property and social classes, and ultimately money and the state (or nation state).

                  You haven’t even begun to understand if you think communism is related to this discussion.

            • vithigar@lemmy.ca
              link
              fedilink
              arrow-up
              5
              ·
              7 months ago

              Even accepting the absurdity of suggesting those as “good reasons” to need more than $100 million dollars in a lifetime, fine. You buy both of those and “only” have 30 million dollars to live on for the rest of your life. That’s still very comfortable and more than most people’s lifetime earnings by an order of magnitude.

    • BrianTheeBiscuiteer@lemmy.world
      link
      fedilink
      arrow-up
      23
      ·
      7 months ago

      If you had a billion dollars and never earned a penny more, you would actually find it hard to spend it all before you die. It could probably fully support several generations of your family. I’m totally fine with saying, “Congratulations! You maxed out the money counter in the game of Life!”

    • Etterra@lemmy.world
      link
      fedilink
      arrow-up
      2
      arrow-down
      5
      ·
      7 months ago

      Make it a million, with an M. Adjusted for inflation after inception, and including stock income. I’ve been saying it for years. Good luck convincing those in power who it would actually effect to enact it though.

      • force@lemmy.world
        link
        fedilink
        arrow-up
        4
        ·
        7 months ago

        It is possible to become a millionaire without exploiting others in the same way the 1% do. I would find a limit somewhere in the tens of millions more reasonable

      • KevonLooney@lemm.ee
        link
        fedilink
        arrow-up
        7
        ·
        edit-2
        7 months ago

        There’s an argument that any one person controlling that much money is harmful to everyone else. Above $1 billion what can you even spend the money on?

        Private planes don’t cost that much. Even a super yacht or the most expensive house in the world cost less. You can buy islands for less.

        Once you have a billion dollars you can live off of 4% without touching the principal. You can just blow $40 million every year. No wonder billionaires think they can do anything. They can as long as they don’t spend too much.

        Edit: I calculated wrong. They can live off 6% to 9% every year, since they will have to spend all their extra money so it’s not taxed 100% at the end of the year.

        That’s $60 - $90 million. Just wasting it every year and replenished by growth the next year. It’s essentially risk-free, unless they pull an Elon and lose billions for no reason.

        That spending would actually be really good for the economy. I like this idea better now.

          • KevonLooney@lemm.ee
            link
            fedilink
            arrow-up
            5
            ·
            7 months ago

            Society is harmed because these people can buy up news and TV companies, donate unlimited amounts to politicians, and generally fuck with the economy. No one can tell them what to do because they have so much money.

            It seems like an aristocracy, which is very un-American. Once people run out of things to buy, how is their life affected by having more money? It essentially appoints them to a job they haven’t earned.

            There’s no reason why Elon should run Twitter. He has no experience in Social Media. Imagine someone you work with just purchased their position and didn’t have to interview or know anything about the field. Would you respect that person? Do you think they would do the job well? It would affect you, the company, and your customers negatively.

              • KevonLooney@lemm.ee
                link
                fedilink
                arrow-up
                3
                ·
                7 months ago

                Once you have over $100 million dollars, earning money is not a matter of skill. It’s an inevitability. Compound interest will make sure you and your family are wealthy for generations, unless you pull an Elon.

                What I’m telling you is many of these people are bad stewards of capital. Gilded Age robber barons sucked for many other reasons, but they at least understood their industry. Carnegie or JP Morgan would have slapped most of these nepo-babies across the face.

                Imagine a sports team composed based on the amount of money people have. It would suck because people are not chosen based on skill. That’s how we’re choosing executive leadership in America right now, and it’s honestly stupid.

                  • KevonLooney@lemm.ee
                    link
                    fedilink
                    arrow-up
                    2
                    ·
                    7 months ago

                    So your point is, you think someone should be able to buy a successful enterprise that’s important for society and run it into the ground? And you think that’s an argument in favor of billionaires?

                    I’m saying the opposite. You should not be able to lose more than a billion dollars. Bets like that should rely on the judgment of many investors, hopefully people who have expertise in the industry.

                    We don’t allow doctors or lawyers to practice without being educated and licensed. There need to be requirements for strategically important companies too.

          • littlewonder@lemmy.world
            link
            fedilink
            arrow-up
            3
            ·
            7 months ago

            Where did that gap of the median 99%'s assets and the assets of the 1% come from? Could it have come from wages that could have been yours if excess profit was based on how much you contributed to the organization’s productivity?