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Careful. The graph you linked shows that inequality going up and beyond after each and every recessionary trough. And the %age owned by the 1 percent is highe

Careful. The graph you linked shows that inequality going up and beyond after each and every recessionary trough. And the %age owned by the 1 percent is higher in that recovery period, than it was before the drop began. Put in another way, that support the assertion that recessionary cycles make the inequality worse. You're just pointing to the acute phase of the recession, when the evidence is in the years immediately after. I think this can be explained because assets can be purchased more cheaply during these periods, leading to a greater share owned to be possible, and thus making the wealth slice of the pie by the 1% to be even more valued.

lend000 4y ago
I think the problem is that every recession on that chart has been "bailed out" in some form by Fed monetary policy, mostly to the benefit of asset holders, and usually far too early or excessively. The increasing overall trend can be attributed to anti-progressive tax brackets (the wealthy pay 20% while the middle class pays 30-45%). But even in an increasing wealth inequality environment, a proper recession should at least decapitalize the stupid among the wealthy and benefit better capital allocators, which is beneficial. Better to have productive Elon Musks getting rich in the aftermath of economic turmoil than SBF's and Adam Neumanns.
- saghm 4y ago
  > Better to have productive Elon Musks getting rich in the aftermath of economic turmoil than SBF's and Adam Neumanns Of all weeks to pick him as an example...
  - lend000 4y ago
    Not arguing with you there, LOL. If he's out of his prime and keeps it up, I imagine it'll negatively affect his wealth significantly (as it should).
banannaise 4y ago
It's also denominator abuse. Most of the assets of the top X% are financial instruments whose nominal value drops sharply in a recession. Those who have liquidity rarely shed those assets. So their relative wealth looks much lower for awhile, but when everything recovers, very little has changed. Meanwhile, they get the opportunity to buy cheap assets from those who did not have liquidity, which worsens both asset consolidation and wealth inequality.

lend000 4y ago

I think the problem is that every recession on that chart has been "bailed out" in some form by Fed monetary policy, mostly to the benefit of asset holders, and usually far too early or excessively. The increasing overall trend can be attributed to anti-progressive tax brackets (the wealthy pay 20% while the middle class pays 30-45%). But even in an increasing wealth inequality environment, a proper recession should at least decapitalize the stupid among the wealthy and benefit better capital allocators, which is beneficial. Better to have productive Elon Musks getting rich in the aftermath of economic turmoil than SBF's and Adam Neumanns.

saghm 4y ago
> Better to have productive Elon Musks getting rich in the aftermath of economic turmoil than SBF's and Adam Neumanns Of all weeks to pick him as an example...
- lend000 4y ago
  Not arguing with you there, LOL. If he's out of his prime and keeps it up, I imagine it'll negatively affect his wealth significantly (as it should).

banannaise 4y ago

It's also denominator abuse. Most of the assets of the top X% are financial instruments whose nominal value drops sharply in a recession. Those who have liquidity rarely shed those assets. So their relative wealth looks much lower for awhile, but when everything recovers, very little has changed. Meanwhile, they get the opportunity to buy cheap assets from those who did not have liquidity, which worsens both asset consolidation and wealth inequality.