The silent flippening in the economy

in LeoFinance •  3 months ago  (edited)

How much wealthier are you this year?

I was reading a story that dropped across my desk and caught my eye from Australia, where the top of the rich list, Gina Rinehart (mining) over doubled her wealth (109%) in the last 12 months, to now have a 29 billion dollar fortune. What was interesting is that overall, the top 200 richest in Australia added a collective 24% in 2020 to have a total wealth of $424 billion.

“At the start of the pandemic many of the fortunes of the nation’s wealthiest were crumbling, but they have proven to be exceptional business builders. They have taken advantage of shifting demands within the economy, driving overall wealth to new highs.”

This was a quote taken from the article and the Australian Financial Review, who compile the list. Do you get the feeling that the impacts of the Covid epidemic aren't impacting everyone equally? With their "fortunes crumbling" at the start, it seems that they are pretty fortunate with the timing - but of course it is because they are "exceptional business builders".

While many, many normal people have been impacted heavily by layoffs and let-goes, those with the means have extended their wealth incredibly. It seems that for the most part, the epidemic has proven to be a brilliant tool for extracting more from the bottom and funneling it to the top and it doesn't look like the process is going to slow down any time soon.

Part of these record gains is due to the money being printed and pumped into the global economies, with bailouts going to businesses and and institutions, but not so much going directly to the people. This means that it is up to the corporations to distribute the wealth, but that hasn't seemed to have happened and instead, they are going from strength to strength. It is going to be interesting to see the aftermath reports come out of the closet over the next few years, but by then it will be too late to do much about it.

The impacts of these lockdowns are going to not only be felt in many social ways for years to come and personal wealth of normal people, they have apparently extended the gap to the rich in ways that mean we will be subject to even more reliance on and control from them. When Bezos extended his wealth from around 110B to 200B, it was very well covered, but he is not the only one - with the 644 billionaires in the US adding almost a trillion between them since March.

The wealth of the nation's billionaires rose to $3.88 trillion as of October 13, a jump of $931 billion from March, an analysis from Americans for Tax Fairness and the Institute for Policy Studies, two left-leaning groups, found. That's almost twice the $2.1 trillion in wealth held by the bottom half of the U.S. population, or about 165 million people, they added. source

Pretty incredible that 644 people in the US have as much wealth as the bottom 165 million, hey? But, that doesn't factor in all the people that aren't billionaires, but might only have between 10 and 999 million, each. I wonder what percentage of the country has over 10 million in wealth and how much it is in comparison to everyone else in the US.

While there is the one percent, but people don't seem to realize that the percentage difference between the bottom of the one percent and the poorest, is less than the bottom of the one percent and the richest. I don't think we have to feel too bad for those poor millionaires that just scraped into the 1% though, as they aren't exactly on the bread line.

It was said above about the billionaires being exceptional business builders and this isn't untrue, as they are very good at building wealth and taking advantage of situations, as they have the disposable capital to invest at pretty much any time and no fear of destitution. But, while fortune favors the brave, if there is no mortal risk, is they actually brave? Fortune favors the rich and in this economy, once rich, it is very, very hard to lose it. While we protect our "right to be rich", we don't recognize that it is much like a token inflation pool where there are billions of people vying over what is being released, without realizing it is a tiny fraction of the entire supply and the majority of the supply is already staked to a handful of users.

If we are going to look at the centralization of wealth, what does it mean when 650 people have the wealth of 165 million other people in the economy, what does it mean when 1% own so much?

From an article last year (2019) in Bloomberg:

The very richest had assets of about $35.4 trillion in the second quarter, or just shy of the $36.9 trillion held by the tens of millions of people who make up the 50th percentile to the 90th percentile of Americans -- much of the middle and upper-middle classes.

What that means is that just with the addition to the billionaires since March, the flippening has already happened and now the richest in the US own more than the entire middle class. Factor in all the other very rich who made gains and the likely retraction of wealth in that middle-class group, and I would predict that the wealth gap has grown much, much larger since the start of the pandemic.

Wealth inequality is going to be the driver for a great deal more social unrest, what we have seen so far in the last six months with riots and taking over regions of cities is just the start, and it isn't going to be confined to the US alone. We are likely seeing the beginning of one of the most tumultuous times in living memory and it is probably going to bring a great deal more violence with it.

I do not know precisely what can be done about it, but at some point the economy is going break under the strain of itself, a system designed to do exactly what it has done, create a gap between the rich and the poor. With wealth attracting wealth, the speed of growth for the richest is exponential, as is the slide into poverty as the top consumes evermore of the tail, with even those making gains at the bottom, still slipping further behind the top.

Taraz
[ Gen1: Hive ]

Posted Using LeoFinance Beta

Authors get paid when people like you upvote their post.
If you enjoyed what you read here, create your account today and start earning FREE STEEM!
Sort Order:  

Fortune favors the rich and in this economy, once rich, it is very, very hard to lose it.

I just read a biography of Elon Musk that was published in 2015. I did not realize how close he came to joining the 1% rather than the 0.01%. He was 24 hours from not making payroll at Tesla when SpaceX got the contract to supply the ISS and a huge payment from NASA. He had used every bit of his Pay Pal fortune and lots of investment money.

Yeah. I think maybe this might be skewed a bit (and I mean only a bit) by Amazon. Talk about being in the right place at the right time when people started to quarantine and need more deliveries. I'm guessing that the CV has permanently altered shopping patterns.

It just can't sustain itself. But what will be the mechanism to tip it back the other way? I have no idea.

Thank you for your engagement on this post, you have recieved ENGAGE tokens.

I didn't know that about Musk, but he is a bit of a baller when it comes to these things - take the shot.

Amazon does skew it and I have a suspicion that the other big four add a fair whack onto it too. Data has become even more valuable.

The only thing that can tip it is revolution - of one kind or another.

Posted Using LeoFinance Beta

!ENGAGE 20

Every word is so true.
Sayings like the rich get richer and the poor get poorer, every man for himself, money makes money, have been around for a long time, and I don't think things will change any time soon.
I wonder how many of these billionaires made this money themselves, or where they just handed it on a silver platter.

(but they have proven to be exceptional business builders. They have taken advantage of shifting demands within the economy,)
There are two parts of this line that I find amusing, as did you. Exceptional business leaders, in many situations I'm sure these people never lifted a finger, the only thing they had to be careful about was to make sure they weren't spending it as quickly as it rolled in.
Taking advantage of shifting demands. As their investments fluctuate, they make money on the way up and on the way down. Many times they control the market.

The redistribution of wealth is in the cards for those of us involved in the crypto space!!

!ENGAGE 20

Thank you very much!

Thank you for your engagement on this post, you have recieved ENGAGE tokens.

I wonder how many of these billionaires made this money themselves, or where they just handed it on a silver platter.

I guess for many, it is a bit of both. Never underestimate the luck of being in the right place at the right time. Many "self-made" forget all of the people it took to be where they are.

they make money on the way up and on the way down. Many times they control the market.

As they say, the best way to predict the future is to make it. This is what I mean with the expanding control over the rest, they have just added another factor of economic dominance.

Hopefully, enough distribution of crypto happens and we don't end up in the same place a few decades from now.

Posted Using LeoFinance Beta

We may very well end up in the same situation years from now. As big banking sees the writing on the wall, what is to say their vaults are not stockpiled with bitcoin instead of the fiat currency. If this were to be the case, once again they would be the ones dictating our financial wellbeing!

If this were to be the case, once again they would be the ones dictating our financial wellbeing!

Yes - but unlike fiat, Bitcoin can be forked :D I think that the Steem to Hive transfer is somewhat indicative of the potential of what can happen if you don't look after your users.

I wonder what percentage of the country has over 10 million in wealth and how much it is in comparison to everyone else in the US.

Probably a little less than one percent. IIRC, it takes about $7 million in assets to be in the top 1% in Murica.

Thank you for your engagement on this post, you have recieved ENGAGE tokens.

I wasn't sure, it was a rough guesstimate. Still, 7M is a far way down the stream from 200B - 28,500x thereabouts.

Posted Using LeoFinance Beta

!ENGAGE 20

Money makes money and will never change. Unfortunately you need to get your hands on the money first. I think many of us are possibly not ruthless and greedy enough as taking advantage of certain situations you cannot care what happens to others.

Thank you for your engagement on this post, you have recieved ENGAGE tokens.

Unfortunately you need to get your hands on the money first

Most of us seem intent on going the other way, into debt instead.

Greed is one thing, but it could also be just being addicted to the game in some way. No one blames a top athlete for destroying their opposition and if anything, it is celebrated. It's a weird world.

Posted Using LeoFinance Beta

!ENGAGE 20

I don't think a small amount of excessively weathly people need all that money, but I often wonder if the planet could sustain 7 billion people if the resources were evenly distributed?
Rich people (and nations) use comparitively more resources
It's safe tp say a lot of good could be done with billions of dollars, but extracting the resources required to give everyone an Australian middle class lifestyle would be the end of us all.
In that sense billionaires can be considered a wealth sink, especially if they spend their money on environmentally responsible, yet extremely expensive stuff.

  ·  3 months ago (edited)

but I often wonder if the planet could sustain 7 billion people if the resources were evenly distributed?

Probably not. But, perhaps there is 7 billion people on earth needed in order for those people to have all that wealth? It is likely that a large part of the population growth is because of the way the economy that enables this wealth, works.

In that sense billionaires can be considered a wealth sink, especially if they spend their money on environmentally responsible, yet extremely expensive stuff.

This is why there are "calls" from some to radically reduce the size of population. We are rich now and we are automated - we don't need all these people we created.

perhaps there is 7 billion people on earth needed in order for those people to have all that wealth?

To maintain the current amount of billionaires and multimillionaires, we probably need billions of people. I'm sure some dystopian plans could make the bottom of the pyramid more efficient, but that would be unpopular to say the least.

There have been excessively wealthy people throughout history long before there were 1 billion people or a resource problem.

Ideally I would prefer to see resources more evenly distributed, but most lifestles in the developed world are far too lavish. We definitely wouldn't benefit.

@tipu curate :)

Thank you. :)

In a system such as this, I can see only one solution for the individual: secede from the system.
This is of course not easy, but I think as this financial system inverts itself the best way forward is to avoid personal debt, get to know our neighbors, produce food and other necessities outside of the big supply chains, and use what wealth we can accumulate to purchase and maintain real property (land,) or that which can help us to be more productive.

I've only taken baby steps in that direction. We are fortunate, in that even as a giant supply chain like Amazon sucks earned income from the common folk to fatten those at the top, it also gives us opportunity. There may come a time when I can no longer count on such a system, but for now it can supply me with pigeon pea and mexican sunflower seeds and other items I could not easily access if I seceded completely from the system, or if/when it crashes.

I would like to believe that Hive is a part of our declaring independence from the system. It could be, I'm not sure. At least, building the ecosystem here has been good practice for a time when the things I used to take for granted - go to school, get a job, build wealth, retire, buy what I need from the store - might not be so available, and we might have to rebuild systems around ourselves.

In a system such as this, I can see only one solution for the individual: secede from the system.

I think this is part of the use case for crypto - to circumvent the centralization and control, by providing financial resources for ourselves. It is kind of like producing our own food.

I think Hive is an exploration into alternative paths and while it might not work as hoped, it is part of building what will arrive later.

What we are seeing playing out in the USA today is the effects of dramatically increasing GINI on society. GINI correlates ~85% to violent crime, and the ~doubling of the wealth of the wealthiest and ~halving of the wealth of the middle class is accompanied by massive riots and violent protests across the country. This is not simply something related to the elections and partisan division in America, because we see this exact same dynamic mirrored all around the world.

I have never been so inundated with reports of massive protests and political unrest in countries globally before. The pretense of deadly plague has not capped the unrest, and for many predatory banksters it is too late to claim they were only pretending to be vampire squid gorging their blood funnels on the dead and dying of oppression and tyranny.

Sowing presages reaping. As the 4th turning is yet again proved out, it is not the poor or disenfranchised middle class that need beware the consequences, because they didn't cause them. They are already suffering them. It is the causes that should expect to be resolved, and the more outrage they have caused, the more they will reap.

4thTurning.jpg

It's looking like 1789 everywhere in 2021 to me. Massive torrents of fiat into the coffers of the wealthy have been flowing into real property, since it is one of the sinks that can accept it. Mortgage payments have risen far, yet the price of guillotines is relatively stable at ~$1200. The nouveau pauvre may not be able to buy a house, but they can still invest in the tools to restore their wealth because those prices haven't risen as fiat has been conjured out of thin air.

Agenda 2030 isn't going to pencil out as expected for those extracting the wealth of the middle class through oppression under cover of plague. I expect them to attain the same results in 2030 the French nobility achieved in 1799.

Thanks!

The price rises out of Demand. That's why Guillotines don't do well and why land is going up.

But, do you honestly think that people without country who are cooperating to such an extent will not "pencil out" their plans as expected? Either you think that you're dealing with psychopaths that have allied to conquer the world, together, or you're not. Or are these extremely determined and driven people, psychopaths non-the-less, are they somehow going to be foiled by some utterly ignorant people, or you think that they somehow compare to the French Nobility, when they have no allegiance to country and even less have any semblance to nobles?

"The price rises out of Demand."

Oversupply of money creates rising prices. Demand for real property continues, but more and more folks can't afford it. In the 1950s the price of a home was ~a years entry level salary in the USA. It's now ten times that. The population hasn't risen tenfold since then. The supply of money has, though.

The globalists consider themselves nobility, I am sure. Country has only ever been determined by power, more empire than nation. Nations are different entirely. Psychopaths and sociopaths are disabled and do not comprehend society normally, as you indicate you understand. Nobility IMHO are more likely to be so impaired, because attaining to such position is facilitated by operating outside of accepted rules. Folks that don't understand rules can do that well. What they can't do well is devise functional societies.

Oversupply of money creates rising prices. Demand for real property continues, but more and more folks can't afford it. In the 1950s the price of a home was ~a years entry level salary in the USA. It's now ten times that. The population hasn't risen tenfold since then. The supply of money has, though.

What's your point, you're agreeing with me it seems, Guillotines aren't in demand, nobody needs Guillotines stat, nobody is putting in orders for them, land on the other hand, everyone wants it and it's in such scarcity to attain that it's value represents it. What you see as simple "supply and demand" is anything but. The Steem paper cited this, I also brought that up to you previously, so you still have yet to regard that fact, more money doesn't mean more inflation, it certainly doesn't correlate. The real dilemma is this: Someone creates one Idea, one Work of Art, any intellectual endeavor as that, where does that Money come from to value that? Everything that creates Value, requires more Money to enumerate it, and it is the scarcity of money that will not be suffered long, rather than a dilution of it. Does it matter that the population hasn't multiplied like Value has, or do you think that value Correlates to population, that wealth is Extinguished when someone dies and that it is Manifested when someone is conceived? It doesn't correlate, much like the increase of money doesn't correlate with the "value" of money. Look up Benjamin Franklin's A Modest Treatise on Paper Currency, read up on how Brazil shit on inflation in the 90's, value is all about perception, and after all, the most valuable things are free.

The globalists consider themselves nobility, I am sure. Country has only ever been determined by power, more empire than nation. Nations are different entirely. Psychopaths and sociopaths are disabled and do not comprehend society normally, as you indicate you understand. Nobility IMHO are more likely to be so impaired, because attaining to such position is facilitated by operating outside of accepted rules. Folks that don't understand rules can do that well. What they can't do well is devise functional societies.

Yes, but that is all perched on the precarious situation that Psychopaths are Collaborating to such an extent, which is preplexing to then go and put faith that they will somehow, HUNDREDS of years in the making of their grand plan, billions of manhours, that it will not "pan" out at the very end............................................ Or you didn't mean that?

  ·  3 months ago (edited)

This is not simply something related to the elections and partisan division in America, because we see this exact same dynamic mirrored all around the world.

People like to mistake symptoms for illness - it is simpler than treating the cause.

The 2025 potential is interesting. I would say that the Russia/China/Iran alliance might be on the cards.

Congratulations @tarazkp! You received a personal badge!

You powered-up at least 500 HP on Hive Power Up Day! This entitles you to a level 4 badge
Participate in the next Power Up Day and try to power-up more HIVE to get a bigger Power-Bee.
May the Hive Power be with you!

You can view your badges on your board and compare yourself to others in the Ranking

Do not miss the last post from @hivebuzz:

Next Hive Power Up Day is November 1st 2020
Trick or Treat - Share your scariest story and get your Halloween badge