TL;DR, wealth is overtaking income in importance:
With wealth increasingly outmuscling income, earning one’s way up the ladder more and more unrealistic, and frequent inflammatory interventions into daily life from the world’s wealthiest, it’s hardly surprising that concerns about wealth are on the rise, even if inequality itself may not be.
This must come as a total shock to absolutely everyone in the fiat age, and certainly to all the stackers reading this. But you can’t earn your way to prosperity anymore; earning a wage isn’t a path to a decent financial life.
Our times are rife with worrying about “inequality”; in the years of Piketty income inequality but these days we (and the Elizabeth Warrens of the world) wealth inequality. Kind of with good reason:
Standard measures of wealth inequality tell us how evenly wealth is distributed in relative terms. This is an important concept but just as important, if not more so, is the extent to which one can move up or down that distribution.
Uncomfortable hypothetical given the plandemic and its associated money printing:
If macroeconomic conditions lead everyone’s wealth to double, relative shares for the top and bottom are unchanged. But if that wealth boom is not matched by a corresponding rise in wages (the ability to earn one’s way up that distribution), suddenly the same-sized relative gaps matter much more, reshaping how the economy both feels and functions.
“While wealth inequality has not changed much, the relative importance of wealth compared to income has.”
A pretty shocking set of graphs, really:
h/t here #1537367... but honestly I got this from an earlier Data Point piece I had occasion to revisit today (#1562329)
The result is that where a generation ago it would have taken about 20 years of savings from the average salary to earn your way from the bottom quarter of the UK’s wealth distribution to the top quarter, it now takes 40
This is all the more pernicious since the growing role of passive wealth gains (whether gifted by an asset price boom or one’s parents) relative to income in determining someone’s economic status is mirrored by their growing importance for wellbeing.
We should of course fuck the boomers for their unearned benefits and wellbeing, but also realize that there’s something specifically brutal happening in the modern redistribution of fiat wealth, where incomes (a good job, per the American dream) are replaced by inheritance and grifting, largely speaking --- Den, heavily editorializing.
Where the gilded class of the much more plutocratic early 20th century engaged in highly visible philanthropy, and often kept their political involvement more financial than vocal, today’s cohort is the opposite.
This, too. If at least the boomers were visibly out there making the world better, there’d be less animosity toward them. Instead, they’re draining the public coffers dry and out playing subsidized golf; fucking commies.
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The problem with indexing wealth and income to 1995 levels is that it gives a false sense of equivalence between two fundamentally different things. These trends could have been in place for a thousand years, for all those graphs tell us.
I doubt it's a thousand years, maybe 50 or 100 years
The point is that the graphs would look the same either way.