News Story of the Day: Say what you want about this generation, but the data suggests that today’s wealthiest Americans are getting younger.
According to Bloomberg, Americans with a net worth of $25 million or more are getting younger as the average age is 47. The wealth appears to be a mix of self-made fortunes and inheritance.
From the business news network:
A survey of U.S. investors with $25 million or more finds their average age dropped by 11 years since 2014, to 47. These fabulously rich Americans, whose ranks have more than doubled since the depths of the Great Recession, are younger than less wealthy millionaires. The average age of those with at least a mere $1 million is 62, a number that hasn’t budged in years.
The finding suggests a “vast generational transfer of wealth” is “just beginning,” said George Walper Jr., president of the Spectrem Group, which conducted the study. The sample size was small—185 Americans with more than $25 million in net worth—but the findings are consistent with other economic research on the top 0.1 percent.
Those over 65 hold more than a third of U.S. wealth, a number that hasn’t risen as quickly as the share of elderly Americans in the population, University of California Berkeley economists Emmanuel Saez and Gabriel Zucman found in a 2016 paper. In fact the very wealthiest group of Americans “is actually getting younger.”
We can poke fun at the young folks for burying their heads in their smartphones, but they’ve got the money.
Chart of the Day: It’s hard to envision tomorrow let alone 11 years from now. But this chart takes a look at the world’s largest 10 economies by 2030. The top three? China, India, and the United States.
Illustration of the Day: We’ll just leave this right here:
Quote of the Day: There is a new central planning monetary theory floating around, one that has been endorsed by Representative Alexandria Ocasio-Cortez (D-NY). If you think it is an ingenious way of manipulating currencies, then think again. It’s just more of the same, but the great Joseph Salerno has this to say:
As I read through articles on MMT (Modern Monetary Theory) this morning, it strikes me that not only is it a recipe for massive inflation but it will also cause chronic depression and capital consumption from the get-go. The newly printed money will not cause an initial economy-wide boom because it will not be injected through credit markets driving down interest rates and stimulating investment. Rather it will go directly into the Treasury, allowing the government to immediately increase its spending on welfare programs, guaranteed-job programs, the “Green New Deal,” and wasted “investment in infrastructure.” It will thus siphon off labor and other resources from productive investment in the structure of production and forcibly increase the consumption/saving ratio and hence overall time preferences, reducing genuine savings and capital accumulation.
Furthermore, as price inflation begins to rear its head, the increase in taxation aimed at “sopping up excess purchasing power” by the private sector, will further increase the public’s time preferences, reduce voluntary saving and eventually cause capital consumption. Everyone will have jobs and rising money incomes and there will be a boom for government contractors so it will not look like a typical depression, but living standards will progressively decline. Also, the private sector will progressively shrink relative to the State sector because BOTH the fiscal inflation AND the later increase in taxes to offset its inflationary price effects will divert resources to the State sector. And of course the recurring increases in taxes will not arrest the inflation, because the government will continue to run fiscal deficits by financing its ever increasing spending with new money. This would be the worst of both worlds: massive inflation proceeding hand in hand with chronic depression.
Tweet of the Day: Regime change is on the menu again, but this time in Venezuela. The U.S. government can’t even help itself, even if it is headed by someone who has railed against America’s foreign policy of the last 20 to 30 years. What’s interesting about the Venezuelan situation are the various viewpoints: one group thinks Nicolas Maduro’s election is legitimate, but still accuse of Trump’s election of being illegitimate; socialists who championed Venezuelan socialism years ago are now supporting regime change; Trumpsters who lamented previous actions in Libya and Syria but endorse this move; and many more.
Glenn Greenwald summarized what’s happening in Caracas:
A person never elected as President of Venezuela but nonetheless being decared to be such by foreign countries who believe he will better serve their interests. https://t.co/H0kMlCOwdb
— Glenn Greenwald (@ggreenwald) January 25, 2019
Video of the Day: The 2020 Democratic primary season is upon us. As the growing field of Democrats attempt to prove that they are morally superior to President Trump, their past will inevitably come up. Senator Elizabeth Warren thinks she’s Native American, Senator Kirsten Gillibrand supported many of the policies of Trump, and Senator Bernie Sanders has to deal with #MeToo. Here is a compilation from the fine folks at the Washington Free Beacon:
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