Home > Uncategorized > “Wealth helps accumulate more wealth”

“Wealth helps accumulate more wealth”

from David Ruccio

The world economy only grew by 3.1 percent in 2015. But the world’s billionaires did much better. As David Barks, associate director of custom research for Wealth-X, understands, “Wealth helps accumulate more wealth.”

According to the latest Wealth-X report on the global billionaire population, the world’s billionaire population grew by 6.4 percent, to 2,473, last year. And their combined wealth increased by 5.4 percent, to a record $7.7 trillion.  

Needless to say, the members of this group of ultra-wealthy individuals form one of the most exclusive clubs in the world; there is only one billionaire for every 2.95 million people on the planet.

So, what were the world’s billionaires doing in 2015? Well, they were busy taking money off the table (liquidity was up to 22.2 percent of their net worth), diversifying their business exposure and investments (finance, banking and investment represent just 15.2 percent of all billionaires’s investments compared to 19.3 percent in 2014), and planning their 2016 social calendar (from Davos to St. Bart’s).

The billions of people who are not in the billionaire club, meanwhile, had quite different worries, including capitalism’s slow growth, precarious employment, and flat or falling incomes.

That’s because they don’t have much in the way of wealth—and what little wealth they do have isn’t the kind of wealth that helps them accumulate more wealth.

  1. August 13, 2016 at 6:10 am

    King Edward 1 created modern Britain. You probably know him from the movie “Braveheart.” He’s called by his other name in that movie, Longshanks. But he had another name also, “Hammer of the Scots.” He got that name by murdering every member of Scottish nobility until he found one who would be his servant in ruling Scotland. He’s also famous for conquering Wales, something never done before. This in itself was unique, but the episode had a more significant aspect. The take-over was sealed by the capture of the Welsh prince Dafydd ap Gruffudd and his imprisonment in London. Then followed his trial for treason, after which he was sentenced to be hanged, drawn and quartered; this brutal punishment was exacted for the first time in the nation’s history, a sign that no traitor’s (to a nation I note of which he was not a part) life was worthy to be spared, noble or no. In simple terms, Edward to maintain his power and wealth murdered anyone, noble or not who threatened it. Is there a difference between Edward and Kochs or Edward and Rupert Murdoch? Or, the other billionaires on your list? Seems to me the goals are the same; only the tools used have changed.

  2. mauro gallegati
    August 13, 2016 at 8:54 am

    it is called, in econophysics, the St.Mtthew effect

  3. robert locke
    August 15, 2016 at 8:57 am

    What about noblesse oblige? In 1870, when Germany invaded
    France, Napoleon III’s bureaucracy fled their local communities to save their necks, but the inhabitants of the local chateaux, who had lost power in France, picked up their weapons and led the resistance to the invaders, for which they were rewarded in the elections of 8 February 1871 by being elected to the National Constitutent Assembly. That is how France found itself in a Republic, with an Assembly dominated by landholding monarhists to work out its destinies. Montesquieu made honor the driving force of successful monarchies, and virtue that of Republics, and fear that of Despoticisms. Elites don’t have to be greedy bastards.

    • August 16, 2016 at 5:57 am

      Robert, it is also quite common for clergy and monks to stay and help in the face of crisis. And philosophers are well known for their lack of fear in dangerous situations. Also, out of power nobility sometimes has a point to make about their class character. But none of this means many elites (nobles, in and out of power, economic elites, social class elites, etc.) are not intent on conquering and ruling non-elites. After all if elites where not better (stronger, more pious, more intelligent, more respected, more courteous, etc.) that other people then they would not be elites. This the the very definition of an elite. But you’re correct that elites are not homogeneous. Some do not press their “right to rule.” However, all elites want to continue their way of life and their individual lives. Armies and soldiers are useful in this pursuit.

      • robert locke
        August 16, 2016 at 3:05 pm

        People who write about elites (Le Bon, Mosca, Pareto, etc.) seem to think that every society is ruled by them and the idea that the “people” rule in a democracy is nonsense. Elites overthrow despots in the name of the “people” Think of he French Revolution, and the Twelve Who Ruled, to use RR Palmers book title, in his work about the Terror in France.

    • August 17, 2016 at 7:11 am

      My point is that elites are “intent on conquering and ruling non-elites.” In other words, the elites want to oversee and determine the life conditions of non-elites. Sometimes this is for personal gain or for societal political power. But sometimes it’s done in the name of helping or protecting the non-elites. Even in the name of improving the lives of the non-elites. Your comment about noblesse oblige falls here. The clergy save our souls and protect our entry into heaven. The leaders of business (kings and aristocrats in older schemes) protect our food, resources, shelter, working life, etc. Political leaders protect our “right” to speak out, if not always to be heard about our lives and the directions our communities are taking. Brian Keith as Teddy Roosevelt comments in the movie “The Wind and the Lion,” “Gentlemen, nothing in this world is certain – absolutely nothing. The fate of the nation will be decided by the American people in November, and the fate of Morocco will be decided tomorrow by me.” Clearly Teddy saw no contradiction between voting democratically and simultaneously “making decisions FOR the American people.” It’s complex. Often elites use an iron fist in a velvet glove. But it’s still a fist.

      PS: the quote from the Roosevelt character is fictional, but is consistent with actual statements of T. Roosevelt.

  4. dmf
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