How do the rich get richer ..

… while others seem to just tread water?


Interesting study reported in the NY Times

The rich really are getting richer …  growing net worth faster than those on lower wealth rungs.


… and, there’s a logical reason why.


According to the Times:

The rich tend to store their wealth in businesses and stocks, and those in the middle class store theirs in housing.

The top 10 percent of the wealthiest households own nearly 90 percent of the stocks in America.

The bottom 90 percent own a little more than half of all the real estate in America.

It’s a race between the stock market and the housing market.

And, that explains why the “wealth gap” may be widening.

In periods when home prices are rising, wealth inequality tends to shrink as the wealth in the middle class grows.

But during periods when the stock market outperforms real estate, wealth inequality tends to increase.

A lot of wealth got destroyed in the 2008 financial crisis … especially for the bottom 90% … and, while housing prices have been inching their way back, the gains have been dwarfed by the booming stock market.

Maybe that’s a legit reason that some people think that the economy isn’t working for them.



Follow on Twitter @KenHoma

>> Latest Posts


Leave a Reply

Fill in your details below or click an icon to log in: Logo

You are commenting using your account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s

%d bloggers like this: