Top 1% of Americans own 56% of US stock - Bottom 90% own just 12% of stock (1 Viewer)

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    superchuck500

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    It's quite a figure and the share held by the top 1% is growing. When you consider the free rein that corporations have to act politically and that those decisions are controlled almost exclusively by the extraordinarily wealthy in a board room where the corporation is legally bound to act in the interest of its shareholders (i.e. the 1%), what does that mean for the bottom 90%? Not in the top 1%? Sucks to be you.

    The wealthiest US households are strengthening their grip over corporate America. The richest 1 per cent of Americans now account for more than half the value of equities owned by US households, according to Goldman Sachs. Since 1990, the wealthiest have bought a net $1.2tn in company stakes, while the rest of the population has sold more than $1tn.

    Three decades ago, ownership was also lopsided, but the top percentage point of Americans by wealth only controlled 46 per cent of all US equities held by households. By the end of September 2019, that proportion had hit a record 56 per cent, amounting to $21.4tn, according to the investment bank’s calculations. That includes both public stock and ownership stakes in private companies.

    “The wealthiest households have been by far the biggest driver of positive household equity demand,” Goldman Sachs analysts, led by Arjun Menon, said in the report.

    “Accelerating US economic growth and rising stock prices should continue to support equity purchases by the top 1 per cent.” Recommended LexEquities World economy/stocks: Piketty is right Premium As of September 2019, the bottom 90 per cent owned $4.6tn of equities, or 12 per cent of the total, the analysts noted.



     
    The red tape and ubiquitous “government” has absolutely nothing to do with why people choose to start a business or not. You can form a LLC, get an EIN and register with the state for under $500.

    Corporate conglomeration, not the government, has killed any chance of starting any real manufacturing or commercial operation. when production, supply and distribution is controlled by a single or a few entities, you have a cartel. And that is a direct symptom of deregulation in interstate commerce. Once we allowed companies to operate massive portfolios of other companies you have a world where General Mills doesn’t own plants anymore but contracts out to regional producers (Schreiber foods) to make & box their product along with Archer Farms (target) and Kirkland (Walmart) and just change the packaging. There is no oxygen in this environment for competition- the competitor’s producer, packaging and supplier is the same.

    Today, you can start a service based business, consulting or a one off (restaurant, liquor store etc). start up costs, market penetration, and the fact you have to basically go 5 years without a paycheck keep most people out of it.

    Tech and the Green Boom (cannabis) have opened some doors, but Silicon Valley app work isn’t helping in Iowa. Cannabis And CBD are the Wild West and uncontrolled capitalism. The reason is the large corporations (at least American) can't touch it (openly) due to the Cole Memorandum
     
    Usually when people claim that "those talking about income inequality are those that are the biggest abusers of income inequality" and list people like Jeff Bezos, Zuckerberg, etc., they would then be able to point to any comments any of those folks have ever made about income inequality.
    They also assume Bezos, Gates, etc. are the exact image of a Democrat they have in their heads; or even that they are Democrats.
     
    So, only the rich should be able to profit? The rest of us should live on the paltry amount SS provides after working for 40+ years? And then have nothing to pass onto to our children.

    It seems like your idea is that the way to decrease wealth inequality is to reduce wealth overall. So what if the stock market or bond market or real estate market takes a downward move after a large influx of investment? I think the economy would actually emerge stronger with more money in it as opposed to sitting hypothetically) in a trust fund doing nothing.

    You keep asking me if I understand how SS works and on the same page you "hypothetically" propose SS is sitting in trust.

    And I never said anything about only the rich profiting or you and I living on SS.

    What I said is that the pool of SS money is too big to release into an already overbought market.

    I also have said that our economy is rigged for the benefit of the rich while the middle class melts away. And that is precisely because of tax policy that has been bought and paid for by rich folks who control the Republican Party over the past 50 years.

    Tax rates on the rich are at the lowest they've been forever yet the middle and lower income get nothing. Not even cake. Why is that? It's because we've spent billions on military adventures and ignored our infrastructure. We've spent very little to provide the basic education and healhtcare required for people to have the stability from which to prosper.

    You can't tax the rich so much that they're not rich and you can't tax them and make the poor rich, but you can tax them in the same manner they were taxed during the 50s and 80s and 00s and spend the money more wisely all while maintaining a more realistic debt.
     
    Income inequality is a function of demand. On this page (https://libertystreeteconomics.newy...places-are-much-more-unequal-than-others.html) is a map of cities with most and least income inequality - what seems clear is that places that are doing very well economically and have a demand for higher-skilled workers end up with the most inequality. While places that are seeing less economic growth have less inequality.

    As far as minimum wage: On the one hand it seems like raising the minimum wage in places like NY, SF, Boston, etc. makes sense while raising it in places like Youngstown, OH, Flint, MI, or Pikeville, KY makes less sense. On the other hand, the employers better able to absorb higher labor costs are large employers - so small businesses operating with low-skilled skilled service labor would be less able to absorb the costs. You can see this in a lot of the cities with higher minimum wage and with greater inequality - although the minimum wage is simply one of many factors.

    Interesting point and while I don't know that I would say income inequality is a function of demand, I do get your point and agree to some extent. Certainly a thriving city with an abundance of good paying jobs is easier to absorb MW changes. Certainly demand for skilled tech workers in a certain locality does contribute to an increasing difference between the middle class, skilled worker and those at the bottom. That much is certain.

    Where I think you're getting off line or maybe just not mentioning is the fact that the increasing wage of skilled labor or talented folks isn't what's driving wealth inequality. The top 1% or the top 1/2% are earning at rates not even similar to what the rest of us are making. 10 years ago Zuckerberg was in college. Bezos wasn't even a billionaire yet. Buffet wasn't worth 80bn or whatever he's worth.

    The concentration of wealth among the top 1% is what concerns me. The fact that a city with a healthy economy is showing wage growth for the 100k folks is offsetting what I see as the problem and I don't even want to blame the Bezos and others. All I want is a tax policy that is fair.

    In my mind, that means someone like Zuckerburg should pay at least as much as I do as a percentage of their income. Bezos should not have Amazon paying less income tax than I do. That's absurd.
     
    In my mind, that means someone like Zuckerburg should pay at least as much as I do as a percentage of their income. Bezos should not have Amazon paying less income tax than I do. That's absurd.
    As a whole - the top 1% of earners have an effective federal income tax rate of almost 27% in 2018. Are you saying your effective rate is higher than that?

    FF622_2.png
     
    People like Mark Zuckerberg, whose wealth is based on stock ownership (his "salary" from Facebook is $1 per year) and is compensated through means other than normal wages, are not taxed on their "income" at the same rate as W-2 employees earning wages. Warren Buffett has famously noted that his secretary pays a higher income tax rate than he does.
     
    People like Mark Zuckerberg, whose wealth is based on stock ownership (his "salary" from Facebook is $1 per year) and is compensated through means other than normal wages, are not taxed on their "income" at the same rate as W-2 employees earning wages. Warren Buffett has famously noted that his secretary pays a higher income tax rate than he does.
    I don't understand your point. Are you saying that Zuckerberg/BUffet is not in the top 1% of income earners? Or that they are outliers from teh top 1% of income earners? Or something else?
     
    I don't understand your point. Are you saying that Zuckerberg/BUffet is not in the top 1% of income earners? Or that they are outliers from teh top 1% of income earners? Or something else?

    I think he is saying that for people like Zuk and Buffett, most of their income is from unearned income. Which the chart that was posted may not include in the calculations. The tax rate on unearned income is often much lower than earned income.
     
    Effective tax rates are figured after either the standard deduction is taken or itemizations are deducted.

    For those with the means, these taxation levers create an easy way to shelter practically all income from taxation.

    But I am pretty sure you know that already.
     
    Effective tax rates are figured after either the standard deduction is taken or itemizations are deducted.

    For those with the means, these taxation levers create an easy way to shelter practically all income from taxation.

    But I am pretty sure you know that already.
    So the idea is that the real top 1% of income earners really aren't the top 1% of "adjusted Gross Income" earners?

    Is that just a guess?

    Regardless, the bottom line is that the top 1% of Adjusted Gross Income earners (which , of course, includes unearned income) pay an effective tax rate of roughly 27%. I certainly have never come close to paying 27% of my income in federal income taxes, much less so actually paying more - I am wondering if dtc routinely does, since he made the point.
     
    You keep asking me if I understand how SS works and on the same page you "hypothetically" propose SS is sitting in trust.

    And I never said anything about only the rich profiting or you and I living on SS.

    What I said is that the pool of SS money is too big to release into an already overbought market.

    I also have said that our economy is rigged for the benefit of the rich while the middle class melts away. And that is precisely because of tax policy that has been bought and paid for by rich folks who control the Republican Party over the past 50 years.

    Tax rates on the rich are at the lowest they've been forever yet the middle and lower income get nothing. Not even cake. Why is that? It's because we've spent billions on military adventures and ignored our infrastructure. We've spent very little to provide the basic education and healhtcare required for people to have the stability from which to prosper.

    You can't tax the rich so much that they're not rich and you can't tax them and make the poor rich, but you can tax them in the same manner they were taxed during the 50s and 80s and 00s and spend the money more wisely all while maintaining a more realistic debt.

    Exactly how I feel...it is such a blatently obvious solution but probably will never happen....

    As a whole - the top 1% of earners have an effective federal income tax rate of almost 27% in 2018. Are you saying your effective rate is higher than that?

    FF622_2.png

    Correct and I'm willing to bet that most of the 1% pay little or no taxes due to below and let's not forget the infamous offshore accounts....the tax policy lawmakers have been duping the public for years on this count....

    Effective tax rates are figured after either the standard deduction is taken or itemizations are deducted.

    For those with the means, these taxation levers create an easy way to shelter practically all income from taxation.

    But I am pretty sure you know that already.

    I certainly am aware of this...well put....
     
    I don't understand your point. Are you saying that Zuckerberg/BUffet is not in the top 1% of income earners? Or that they are outliers from teh top 1% of income earners? Or something else?

    I think your chart applies to people who earn income from wages and not from capital gains, etc. When Jeff Bezos sells stock, he isn't paying 27%. Most rich people don't release their tax returns for public consumption, but in the highest profile reveal I can recall we learned in 2012 that Mitt Romney paid around 13-14% on $20+ million in income, and that was before the latest round of tax cuts. Why do you think Trump has fought the release of his tax returns at every turn for over four years?
     
    I think your chart applies to people who earn income from wages and not from capital gains, etc. When Jeff Bezos sells stock, he isn't paying 27%. Most rich people don't release their tax returns for public consumption, but in the highest profile reveal I can recall we learned in 2012 that Mitt Romney paid around 13-14% on $20+ million in income, and that was before the latest round of tax cuts. Why do you think Trump has fought the release of his tax returns at every turn for over four years?
    Where do you get that from? I don't see any reason to doubt that when a person pays taxes they pay taxes on all income. It may be taxed at different rates but it is all income and it is all taxed. Its how I do my taxes.
     
    It’s true that the top personal tax rate on capital gains (20%, or 23.8% including the net investment income tax) is lower than the top rate on ordinary income (which is 37%). And it’s also true that capital gains are disproportionately earned by the very wealthy.

    But, as we said, the top 1% on average pays a higher effective federal tax rate than middle-income earners.

    According to an analysis by the nonpartisan Tax Policy Center, the top 1% — those making over $783,300 ($2.4 million on average) — will pay about an average federal tax rate of 30.2% in 2019. That’s a higher rate than any other income category below it.

     
    Let’s try this another way.

    I make (hypothetically) $225k a year owning a boutique manufacturing company. My effective tax rate would still have been at 19% even after deductions. For clarity my effective tax rate would have been set at roughly $175,000 after federal deductions, again still 19%.

    However, since all but $35k is not a salary but a dividend off of earnings, my effective tax rate on earned income is zero. Then I pay 13% on the other $195k as capital gains. So all in, I paid $25k in taxes on $225k of income, or 11%. This happens every fiscal year by everyone who owns an llc, unless they aren’t savvy enough to use TurboTax.

    But again I think you already know all of this.
     
    As a whole - the top 1% of earners have an effective federal income tax rate of almost 27% in 2018. Are you saying your effective rate is higher than that?

    FF622_2.png

    Some years, yes, but I imagine I am the top 1%.

    I'm probably the very bottom of the top 1% though so it isn't getting to the point.

    It's not the average top 1 that's the problem. It's the ones who make 100m/year and pay 18% or the Amazons that pay nothing. It's patently unfair.

    Also, the stated rate for that period of time was 39%. The average being 13% less - one third of the stated rate less than the rate - illustrates my point.

    That chart also appears to be specific to "wage earners" which isn't the same as all income, but you get my point now I'm sure.
     

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