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.
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.
Even as a someone with no experience, I can be accepted as a “lawyer” by a law company. But no would ever accept me because they it would harm the company very much.
Same thing applies for companies. There is already a motivation for their leaders to lead them in the best way possible even without limited maximum amount of money. In addition, there is no such a company that is so critical that its crash would destroy the world.
There’s no real impact on anyone’s standard of living. Literally no one’s life is worse off, and the country is better off. What’s the downside?
Because it is simply limiting what a person can achieve. Hence why I would rather see sanctions on specific actions.