5 ms·

It’s a little known fact that IQ is positively correlated with income, but there’s no correlation at all with net wealth. It is to be expected that there will b

by kubb 3y ago

It’s a little known fact that IQ is positively correlated with income, but there’s no correlation at all with net wealth. It is to be expected that there will be entire industries that spring up to extract some of that wealth from the less bright wealthy. The art market is one of such industries.

yieldcrv 3y ago
Thanks for breaking it down like that
snthd 3y ago
https://www.ft.com/content/3b1de7dc-368f-4864-bb73-cf4308a61899 https://www.ft.com/content/3b1de7dc-368f-4864-bb73-cf4308a61... >A senior lawyer who works for a private bank in Zurich says that, although egregious, the situation was hardly novel: it is widespread practice in Switzerland that independent wealth managers are given full power of attorney by clients. >“We have clients where, basically, the authorised representatives, their financial advisers, do things like go and buy an expensive watch or whatever, and if we say, ‘No, don’t do that’, we will hear something back asking us why on earth we are making a fuss . . . They say they have given these people these powers, and it’s not up to us to decide what is reasonable or not.”
- PaulHoule 3y ago
  I always thought the 415 scams were aimed at rich people with poor judgement. I mean, who believes $10 million is going to fall out of the sky and hit them except someone who has already been hit with $10 million falling from the sky? Plus there is a limit for how much money you can scam out of a normal person.
  - sumtechguy 3y ago
    You can watch some of the scam baiter channels on YT. The scammers are not targeting the very rich (though they would not mind getting in on that). Usually they target retired people who have lost some of their faculties.
    - rurp 3y ago
      The mass market Nigerian prince style scams are basically a completely different industry from the $100M art scam one.
steveBK123 3y ago
Well put. If you've lived in NYC for any amount of time, you see both sides of this. 1) Disparate industries seemingly conspiring to extract every marginal dollar out of wealthy people (good for them). That is, there seems to be no amount of money you can have that isn't easily disposed of in NYC, leaving you wishing you had 10x more. 2) Wealthy people by inheritance who seem to be genuinely room temperature IQ out competing high income earners for the best apartments, with all cash offers
- sackfield 3y ago
  Do you happen to know if those low intelligence wealthy people are slowly losing their wealth? Or is there a structure (like a trust) that administers this so they can't lose too much of it by their own action.
  - Staple_Diet 3y ago
    There's a common refrain that wealth disappears within 3 generations.
    - steveBK123 3y ago
      From my NYC observations, 3 generations seems like the best case.
  - steveBK123 3y ago
    It definitely varies. In Brooklyn there are plenty of kids who inherited money and working jobs that do not match their wealth/housing/lifestyle. So they are spending down whatever wealth they inherited for sure. The typical picture I've seen is that the parents/trust buy them a condo all-cash, and then the underemployed then live a lifestyle that implies easily a $1M/year income except in a job that would imply a $0-$100k income. So unless they inherit like $25M+, they are spending it down quickly. I've also seen the early stages of this from the other end with my colleagues, where parents in NYC who come from more modest backgrounds, end up making FAANG level salaries but then having kids that want to get a philosophy degree and work at an NGO (while enjoying having a place in Manhattan to live and traveling internationally 3x/year). I guess theres a fine line between giving your kids space to grow & pushing too hard / trying to choose their path for them.. But being raised in comfort does seem to remove the striving mindset and understanding that this lifestyle doesn't come for free or from a fun job.
mjburgess 3y ago
Could you provide some reference/evidence to this IQ/income correlation? In particular, I would expect no correlation above ~100 -- has this been controlled for?
- thfuran 3y ago
  Why would you expect that?
  - mjburgess 3y ago
    That's what the wealth relationship shows. The only correlation is with the mental retardation range. Indeed, it seems very very likely that all correlations alleged of IQ, on independent performance measures, are just in this region (ie., that positive correlation above 100 comes merely from a trendline fit in the negatives).
timmg 3y ago
> It is to be expected that there will be entire industries that spring up to extract some of that wealth from the less bright wealthy. I'm not sure it is as much "less bright" as maybe "more impulsive" or something like that. I think someone can be very smart and still want to "live for today".
deleted 3y ago
[deleted]
LastTrain 3y ago
What are some sources for that fact?
- kubb 3y ago
  https://www.sciencedirect.com/science/article/abs/pii/S0160289607000219 https://www.sciencedirect.com/science/article/abs/pii/S01602... https://www.sciencedirect.com/science/article/abs/pii/S0160289606001127 https://www.sciencedirect.com/science/article/abs/pii/S01602...
  - LastTrain 3y ago
    Thanks. I guess the thing that sparked my curiosity / skepticism was that if there is a correlation between IQ and income, but none between IQ and wealth, it would seem to suggest there is also no correlation between income and wealth (or economic status, as these articles call it). I've only read the free snippets from the articles you posted, where this point isn't addressed directly but I have to assume they addressed it in some fashion in the full texts.
    - kubb 3y ago
      I'm guessing getting wealthy only through income is not very common. People get wealthy by inheriting or by holding assets, not by earning a salary.
BlueTemplar 3y ago
That doesn't make sense. While IQ is mostly pseudoscience, I would still expect at least a small fraction of it to be inherited (along with money (not/) coming from (grand)parents' income in a smaller fraction of cases).

by kubb 3y ago

yieldcrv 3y ago

Thanks for breaking it down like that

snthd 3y ago

https://www.ft.com/content/3b1de7dc-368f-4864-bb73-cf4308a61899 https://www.ft.com/content/3b1de7dc-368f-4864-bb73-cf4308a61... >A senior lawyer who works for a private bank in Zurich says that, although egregious, the situation was hardly novel: it is widespread practice in Switzerland that independent wealth managers are given full power of attorney by clients. >“We have clients where, basically, the authorised representatives, their financial advisers, do things like go and buy an expensive watch or whatever, and if we say, ‘No, don’t do that’, we will hear something back asking us why on earth we are making a fuss . . . They say they have given these people these powers, and it’s not up to us to decide what is reasonable or not.”

PaulHoule 3y ago
I always thought the 415 scams were aimed at rich people with poor judgement. I mean, who believes $10 million is going to fall out of the sky and hit them except someone who has already been hit with $10 million falling from the sky? Plus there is a limit for how much money you can scam out of a normal person.
- sumtechguy 3y ago
  You can watch some of the scam baiter channels on YT. The scammers are not targeting the very rich (though they would not mind getting in on that). Usually they target retired people who have lost some of their faculties.
  - rurp 3y ago
    The mass market Nigerian prince style scams are basically a completely different industry from the $100M art scam one.

steveBK123 3y ago

Well put. If you've lived in NYC for any amount of time, you see both sides of this. 1) Disparate industries seemingly conspiring to extract every marginal dollar out of wealthy people (good for them). That is, there seems to be no amount of money you can have that isn't easily disposed of in NYC, leaving you wishing you had 10x more. 2) Wealthy people by inheritance who seem to be genuinely room temperature IQ out competing high income earners for the best apartments, with all cash offers

sackfield 3y ago
Do you happen to know if those low intelligence wealthy people are slowly losing their wealth? Or is there a structure (like a trust) that administers this so they can't lose too much of it by their own action.
- Staple_Diet 3y ago
  There's a common refrain that wealth disappears within 3 generations.
  - steveBK123 3y ago
    From my NYC observations, 3 generations seems like the best case.
- steveBK123 3y ago
  It definitely varies. In Brooklyn there are plenty of kids who inherited money and working jobs that do not match their wealth/housing/lifestyle. So they are spending down whatever wealth they inherited for sure. The typical picture I've seen is that the parents/trust buy them a condo all-cash, and then the underemployed then live a lifestyle that implies easily a $1M/year income except in a job that would imply a $0-$100k income. So unless they inherit like $25M+, they are spending it down quickly. I've also seen the early stages of this from the other end with my colleagues, where parents in NYC who come from more modest backgrounds, end up making FAANG level salaries but then having kids that want to get a philosophy degree and work at an NGO (while enjoying having a place in Manhattan to live and traveling internationally 3x/year). I guess theres a fine line between giving your kids space to grow & pushing too hard / trying to choose their path for them.. But being raised in comfort does seem to remove the striving mindset and understanding that this lifestyle doesn't come for free or from a fun job.

mjburgess 3y ago

Could you provide some reference/evidence to this IQ/income correlation? In particular, I would expect no correlation above ~100 -- has this been controlled for?

thfuran 3y ago
Why would you expect that?
- mjburgess 3y ago
  That's what the wealth relationship shows. The only correlation is with the mental retardation range. Indeed, it seems very very likely that all correlations alleged of IQ, on independent performance measures, are just in this region (ie., that positive correlation above 100 comes merely from a trendline fit in the negatives).

timmg 3y ago

> It is to be expected that there will be entire industries that spring up to extract some of that wealth from the less bright wealthy. I'm not sure it is as much "less bright" as maybe "more impulsive" or something like that. I think someone can be very smart and still want to "live for today".

deleted 3y ago

[deleted]

LastTrain 3y ago

What are some sources for that fact?

kubb 3y ago
https://www.sciencedirect.com/science/article/abs/pii/S0160289607000219 https://www.sciencedirect.com/science/article/abs/pii/S01602... https://www.sciencedirect.com/science/article/abs/pii/S0160289606001127 https://www.sciencedirect.com/science/article/abs/pii/S01602...
- LastTrain 3y ago
  Thanks. I guess the thing that sparked my curiosity / skepticism was that if there is a correlation between IQ and income, but none between IQ and wealth, it would seem to suggest there is also no correlation between income and wealth (or economic status, as these articles call it). I've only read the free snippets from the articles you posted, where this point isn't addressed directly but I have to assume they addressed it in some fashion in the full texts.
  - kubb 3y ago
    I'm guessing getting wealthy only through income is not very common. People get wealthy by inheriting or by holding assets, not by earning a salary.

BlueTemplar 3y ago

That doesn't make sense. While IQ is mostly pseudoscience, I would still expect at least a small fraction of it to be inherited (along with money (not/) coming from (grand)parents' income in a smaller fraction of cases).