In America: The Top 1% Own 32.1% of The Country's Total Wealth, The Bottom 50% Own 2.5%

Mish Talk ^ | 02/14/2022 | Mike Shedlock

[SeekAndFind]

The percentage of wealth owned by the top 1% keeps rising over time. Who's to credit or blame?

Data Source: Board of Governors of the Federal Reserve System (Fed), Chart by Mish

This data series compiled by the Fed started in the third quarter of 1989. The most recent data is from the third quarter of 2021.

If you have not seen charts of this series before, the numbers may seem shocking.

1989 Q3 vs 2021 Q3 Percentages

• Top 1% Then 23.6%, Now 32.1%

• 90th to 99th Percentile Then 37.3%, Now 37.5%

• 50th to 90th Percentile Then 35.6%, Now 27.9%

• Bottom 50% Then 3.7%, Now 2.5%

Gains or Losses Since 1989

• Top 1%: +8.5 Percentage Points

• 90th to 99th Percentile: +0.2 Percentage Points

• 50th to 90th Percentile: -7.7 Percentage Points

• Bottom 50%: -1.2 Percentage Points

Key Points

1. The bottom never had much to lose but they managed to lose a bit anyway.

2. The top keep padding their wealth but remain the most impacted by recessions.

3. The middle class is shrinking.

Credit and Blame

Many people will blame the wealthy. But the actual culprit is the Fed.

The bottom 50% sure don't gain from bubbles.

Those with assets are the beneficiaries. And when the Fed steps on the gas, look at the far right of the chart to see what happens.

Beneficiary of Inflation

Inflation benefits those with first access to money and that's the banks and the already wealthy.

The poor who spend every penny and them some on food and shelter get hammered by inflation.

Meanwhile, the middle class keeps shrinking.

CPI Jumps Most in 40 Years

The Fed tried for a decade to increase inflation. The Fed even wanted to "make up" for lack of previous inflation.

But the CPI rose another 0.6% in January, at a year-over-year clip of 7.5%. The CPI is at the highest pace in 40 years.

For discussion, please see CPI Jumps Most Since February 1982, Up at Least 0.5% 9 Out of Eleven Months

The Fed finally succeeded and then some at producing inflation. Now doesn't know what to do about it.

But should the banks get in trouble again, the Fed will be right there again to bail them out just as it did in 2000 in the dotcom bust and again in the 2007-2009 housing crash.

* * *

[Scrambler Bob]

Does this mean they should open a soup kitchen on the ships?
= = =

Those rich cruise passengers are just feeding the sharks that their ancestors once fed.

[BiglyCommentary]

“The percentage of wealth owned by the top 1% keeps rising over time. Who’s to credit or blame?”

As a general rule it takes money to make money and if you don’t have money it will cost you.

Also if you divided up all the money in the world into equal piles and gave each person their pile, in 10 or 20 years those who were rich will be rich again and those who were poor will be poor again.

[married21]

What is the quality of life for the lowest 2.5%?

[TigersEye]

Compare it to America capitalist era and see.

What and when is "America capitalist era" and what would I see?

[dfwgator]

There just aren’t that many people that have the ambition and drive to do what it takes to get rich, they just sit back and expect wealth to fall from the sky.

[dfwgator]

Also if you divided up all the money in the world into equal piles and gave each person their pile, in 10 or 20 years those who were rich will be rich again and those who were poor will be poor again.

That's exactly what happens if they ever do get Reparations for Slavery, just as in that Chappelle skit.

[Chode]

like the asskicking they so richly deserve...

[TigersEye]

One of the earliest Buddhist kings of Tibet did exactly that. By edict he required that all property be divided equally among the people. It took ONE year for it all to return to the way it was.

So he ordered it done again. Again it took ONE year to return to the way it was before.

He had compassion but lacked wisdom. He did gain some from the experiment and seeing his error never tried it again.

[dfwgator]

See the Bolsheviks understood this, so they took the money then just shot the people who had the money.

[TigersEye]

LOL

I shouldn’t laugh, it’s true.

It’s amazing how many ways people can justify theft and murder and doing it on a grand scale seems to one of the most common ways to rationalize it.

[DesertRhino]

I would think the post WWII era 1946 until 1966 would be a good snapshot to judge the economic power of the middle class vs the size of the 1%ers.

Let me know what you find.