I’m an avid reader of TechCrunch. Like most blogs they compete on the edge for eyeballs which puts most in the grey area of posting both actual news and rumor even without confirming from any discernible sources. TC does a good job on updating us all on Valley stories, news and tech but they still could benefit from getting off the iPhone jock and limiting useless rumors to focus their content. This is a great story of Facebook, setting up an actual feature and calling it to only those on the TC network; which in turn they put out there as a real feature without confirming it directly from Facebook (“Maybe I’m missing something here, but I’m not sure why Facebook would do this. “). Check the full Punk’d Story.
Is there ever enough “Wealth “?
“The real source of wealth and capital in this new era is not material things.. it is the human mind, the human spirit, the human imagination, and our faith in the future.”
Read that quote again. Fairly profound, you’d think this was said by a leader, a philosopher or some other humanist of our time. No. Steve Forbes said this. I have no idea of context but for some reason, I think what came right after this was the quote “Pppppppfffffffftttttt… If you believe that crap, I have a bridge to sell you…”
Noel Whittaker a financial author and investment advisor said it better: “Becoming wealthy is like playing Monopoly.. the person who can accumulate the most assets wins the game.”
What constitutes as Wealthy or Rich today in Noel’s terms? Is there a bar that you can mark that says, as soon as I have accumulated this percentage of assets, or XYZ capital, or own some number of high profile items with a steady cash flow, that’s a mark for rich. Is an income of $400,000 a year rich?
This presidential political season and subsequent recession has created a climate of concern for many middle class to wealthy Americans that feel their choice for conspicuous consumption is being limited by new tax laws (Obama’s tax plan) and possibly as the Washington Post puts it “social proof”.
The Journal has an article today called Wealth-Less Effect: Earning Well, Feeling Otherwise; where those just over $250,000 income levels are feeling pinched to cut back and even “forced” to curb living habits they feel they deserve at their income levels. As the Journal puts it:
It is a tricky situation in which some Americans find themselves after a long boom: They are by no means struggling, compared with the 98% of Americans who make far less, but depending on where they live and the lifestyle choices they have made, they don’t necessarily feel rich, either. Worse, in their view, they are facing the same tax rates as those making millions. Some of the expenses are self-inflicted — like private-school costs and conspicuous consumption. Others, though, are unavoidable, like child-care costs, larger health-care deductibles and education expenses, especially college.
The reality is that the median income earner in America is just over $50,000:
2.245 Million households in American, had income greater than $250,000 in 2007 which is actually 1.9% of the total household earners in America. These articles try to convey these rich people are saddled with:
- Education costs, which are far outstripping wages and income – 62% of high school graduates who don’t go on to four-year institutions which has become an institution of the rich and middle class in America
- Changes to the tax code don’t generally make adjustments for high costs of living in particular areas of the country – It’s expensive in cities, however, the median income inside cities is lower than the national average at $43,800
- Health- care expenses have gone up 4.16% annually, while wages and income have risen only 3.7% over the same time span. – Median household health care expenses in 2006 were $1,185, or .4% of $250,000.
Our capitalistic society has created an environment of spenders regardless if those purchases are necessary or warranted. The majority of expenses, our flat screen TVs, luxury cars, designer clothes, immaculate multi-room houses all emulate a personal choice and even social entitlement within the circles of friends and community these people reside.
As Daniel Gross writes in Slate, those that earn $250,000 in Greenwich, CT would certainly look to be poor based on their neighbor’s affluence (median income levels of $231,138, however, income at that level in Mississippi would represent top earners of most towns (median income of $35,971).
I find it interesting that either by choice or social proof, these earners must finally now evaluate their spending habits and re-align them to reality. All Americans have fallen into this trap of spending beyond our means, and we’ve all checked our spending to accommodate an uncertain future. It’s, however, comical to me for those that make a considerable income more than my family must now whine that they no longer can consume as they so desire.
This mentality of entitlement permeates all classes and whether you’re poor or rich, what ever level of income you do have, never seems to be enough. I hope that Steve Forbes is right, and more people take stock in the human mind, spirit, and imagination for our future.
WASPs happy to take back what’s “theirs” in Palm beach
Not since the Hamburgler has a crook’s name so explicitly said what he’s going to do. Bernie Madoff has taken the the money of some of the richest people in America and the world, it just so happens that most of his victims, whom tended to invest EVERYTHING in the 10-12% returns, were Bernie’s “friends”, the Jews.
There’s been several stories of ground zero, Palm beach where the barometer of the recession’s impact on the wealth has been closely watched. However, this NY Times article goes further to capture the entitlement, defensiveness, and rank opportunism on display among those in the overclass who have lost fortunes, yet remain wealthy beyond all reason and feel permitted to participate in the national sense of despair over our calamity1.
Experience the pain:
“Customers that can still come in and afford to buy fine pieces of jewelry have this feeling of guilt,†he says, sitting next to a couple of vaults at the rear of his store, H. T. Stuart & Company. “They say, ‘I still want to buy jewelry, but I feel funny, and I have friends and these people know others who got hurt, pretty badly, and they don’t want to flaunt it.’ I have to try to convince them to go on living.â€
Down the street, at Trillion, Mr. Neff says his customers will go for rarities, like a $1,200, super 180 wool sweater knitted on something called a 39-gauge machine. Everything else is a tough sell.
“They won’t deny themselves the top top,†Mr. Neff says. “I used to say, ‘I know you have eight blue blazers but look at this blue blazer. It’s an upgrade.’ And any upgrade, they’d buy. This year, they don’t want to seem foolish. Eight blue blazers is enough.â€
At a men’s store called Crease Liberty, a longtime customer recently told Jennifer Inga, a saleswoman, that he wouldn’t be buying anything for a while, because his net worth had dropped to $12 million from $30 million.
“He said, ‘Now is not the time.’ It’s mind-boggling to me,†Ms. Inga said. “How can someone with $12 million feel like they can’t afford a new pair of pants?â€
So where’s the tension?
Aside from death and money, the topic that preoccupies everyone here the most, and is spoken of the least, is the gentile-Jewish divide. As recounted in “Madness Under the Royal Palms,†Palm Beach was founded in the late 19th century by Henry Flagler, a Standard Oil executive, and for years it was dominated by white Anglo-Saxon Protestants.
In the middle of the last century, A. M. Sonnabend, a Jewish entrepreneur, started buying commercial property, including what became the Palm Beach Country Club, and nouveau-riche Jews suddenly had a hotel, beach club and a golf course of their own. Gradually, enough moved here to be described by the Christian elites as “the other half,†many of them clustered in large condominium buildings south of a place called Sloans Curve, known informally by just about everyone as the Gaza Strip. (That the real Gaza Strip is inhabited by Palestinians is apparently beside the point.)
Read full article here including the almost purchased $2000 Bernie Madoff pants.
(1 John Cook)