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Wealth is finite, it typically does not last more than a couple generations. Bad decisions also generally cost more than good ones. The same cannot be said fo

Wealth is finite, it typically does not last more than a couple generations. Bad decisions also generally cost more than good ones. The same cannot be said for many other types of power.

ChuckNorris89 6y ago
Unless by rich people you mean lottery winners and Instagram influencers, the truly rich people have top financial education, trust funds and top wealth management companies that keep their wealth growing so they can't make mistakes.
- DethNinja 6y ago
  If that was the case then why there are so many zombie companies? I would say USA will lose considerable power over the coming years because of their bad economic management.
  - imtringued 6y ago
    Zombie companies are the result of a low inflation policy. If you want to keep your company going you can just borrow a lot of money for almost nothing.
- aeternum 6y ago
  Those wealth management companies charge significant fees and typically do not beat the market once fees and legal expenses are considered. If you look at any list of the truly rich, it is almost all 'new money', of those that are beneficiaries, the money was inherited relatively recently (such as the Walton family). https://www.forbes.com/forbes-400/ https://www.forbes.com/forbes-400/
  - InitialLastName 6y ago
    The goal of a wealth management company (targeted at the very wealthy) isn't just "I want to beat the market". A wealthy enough person can live a comfortable life on savings account interest and still be wealthy when they die. The goals end up being a) beat inflation enough to cover my expenses and b) protect from any risk of not being wealthy".
  - dlp211 6y ago
    There are quite a few problems with the Forbes 400 list, most notably it does not in fact capture the wealth of the 400 wealthiest people/families. A lot of old money is left off these lists because...well it's old money and they don't want the publicity. There are a bunch of other things to consider, for instance diversification of wealth has fundamentally transformed since the early 1900's and wealth management is on a completely different level than even 20 years ago, let alone 120 years ago. Not to mention the legal innovation to protect estate value that has been going on. I'll also point out that the people on that list are generally not using Fidelity, Vanguard, or Hancock as their wealth management services. They are using private family offices or firms like PDT Partners that are directly accountable to those families.
  - deleted 6y ago
    [deleted]
tehjoker 6y ago
Please tell that to the Rockafellers and other ultra-wealthy dynastic families that keep a variety of lower profiles but have incredible influence.
- nickik 6y ago
  Selection bias at work
  - tehjoker 6y ago
    There are a few of them because wealth concentrates upwards. Their mere existence as dynastic families proves that wealth does not always flow downwards but persists in an American aristocracy that stands out of public view and allows us to pretend otherwise.
    - nickik 6y ago
      You are still making the same mistake. > There are a few of them because wealth concentrates upwards. Is your argument really that all wealth is already owned by some dynastic elite and that's why nobody else can get to that level? That is nonsense. Wealth outside these is gigantic. We constantly see economic growth that creates wealth, and new fortunes for people. Somebody in tech should really understand this, and these new rich often actually more influential and richer then some of these dynastic elite. > Their mere existence as dynastic families proves that wealth does not always flow downwards That's not what me or parent argued, nice straw-men.
- aeternum 6y ago
  Rockafeller's peak net worth was an inflation adjusted US$418 billion. In 2016 the family's net worth was estimated at 11 billion total. Sure that's significant but nothing compared to what it was.
  - contingencies 6y ago
    One could perhaps raise the theoretical conjecture that a substantial part of the art of preserving modern wealth is taking it off the table...
contingencies 6y ago
Wealth is finite, it typically does not last more than a couple generations. Chinese has a great saying for this: 富不過三代 (Wealth does not pass three generations).

Wealth is finite, it typically does not last more than a couple generations. Bad decisions also generally cost more than good ones. The same cannot be said for many other types of power.

ChuckNorris89 6y ago

Unless by rich people you mean lottery winners and Instagram influencers, the truly rich people have top financial education, trust funds and top wealth management companies that keep their wealth growing so they can't make mistakes.

DethNinja 6y ago
If that was the case then why there are so many zombie companies? I would say USA will lose considerable power over the coming years because of their bad economic management.
- imtringued 6y ago
  Zombie companies are the result of a low inflation policy. If you want to keep your company going you can just borrow a lot of money for almost nothing.
aeternum 6y ago
Those wealth management companies charge significant fees and typically do not beat the market once fees and legal expenses are considered. If you look at any list of the truly rich, it is almost all 'new money', of those that are beneficiaries, the money was inherited relatively recently (such as the Walton family). https://www.forbes.com/forbes-400/ https://www.forbes.com/forbes-400/
- InitialLastName 6y ago
  The goal of a wealth management company (targeted at the very wealthy) isn't just "I want to beat the market". A wealthy enough person can live a comfortable life on savings account interest and still be wealthy when they die. The goals end up being a) beat inflation enough to cover my expenses and b) protect from any risk of not being wealthy".
- dlp211 6y ago
  There are quite a few problems with the Forbes 400 list, most notably it does not in fact capture the wealth of the 400 wealthiest people/families. A lot of old money is left off these lists because...well it's old money and they don't want the publicity. There are a bunch of other things to consider, for instance diversification of wealth has fundamentally transformed since the early 1900's and wealth management is on a completely different level than even 20 years ago, let alone 120 years ago. Not to mention the legal innovation to protect estate value that has been going on. I'll also point out that the people on that list are generally not using Fidelity, Vanguard, or Hancock as their wealth management services. They are using private family offices or firms like PDT Partners that are directly accountable to those families.
- deleted 6y ago
  [deleted]

tehjoker 6y ago

Please tell that to the Rockafellers and other ultra-wealthy dynastic families that keep a variety of lower profiles but have incredible influence.

nickik 6y ago
Selection bias at work
- tehjoker 6y ago
  There are a few of them because wealth concentrates upwards. Their mere existence as dynastic families proves that wealth does not always flow downwards but persists in an American aristocracy that stands out of public view and allows us to pretend otherwise.
  - nickik 6y ago
    You are still making the same mistake. > There are a few of them because wealth concentrates upwards. Is your argument really that all wealth is already owned by some dynastic elite and that's why nobody else can get to that level? That is nonsense. Wealth outside these is gigantic. We constantly see economic growth that creates wealth, and new fortunes for people. Somebody in tech should really understand this, and these new rich often actually more influential and richer then some of these dynastic elite. > Their mere existence as dynastic families proves that wealth does not always flow downwards That's not what me or parent argued, nice straw-men.
aeternum 6y ago
Rockafeller's peak net worth was an inflation adjusted US$418 billion. In 2016 the family's net worth was estimated at 11 billion total. Sure that's significant but nothing compared to what it was.
- contingencies 6y ago
  One could perhaps raise the theoretical conjecture that a substantial part of the art of preserving modern wealth is taking it off the table...

contingencies 6y ago

Wealth is finite, it typically does not last more than a couple generations. Chinese has a great saying for this: 富不過三代 (Wealth does not pass three generations).