Looks the like the market booming for the last 4 years has minted many new millionaires, 300,000 and counting (8.99m) and almost nearing 9.2 millionaires in US, which was the ultimate record set back in 2006 before the crisis began.... But wait just a darn second it seems that most of that wealth has gone to the top 10% of americans since they own more than 80% of all stocks!!!! Hmmmm so it is true that the rich get richer and the poor get poorer, hmmmm. Lets see how many more millionaires BUBBLE ben bernanke can mint before the next asset bubble bursts. US (and Booming Market) Adds 300,000 New Millionaires Published: Thursday, 14 Mar 2013 | 10:52 AM ET By: Robert Frank CNBC Reporter & Editor The rising stock market has pushed America's millionaire population close to its all-time highs before the recession. According to data from Spectrem Group, the Chicago-based wealth research firm, there are now 8.99 million U.S. households whose net worth totals $1 million or more (not including primary residence). That's up from 8.6 million in 2011 and just short of the all-time record set in 2006, when the United States had 9.2 million millionaire households. The stock market's rise has been the biggest driver of millionaire creation. With this year's gains, Spectrem said, the United States may have already exceeded its all-time record. Most of the benefits from rising stocks have gone to the wealthy, since the top 10 percent of Americans own more than 80 percent of all stocks, according to research from Edward Wolff of New York University. But the recent stock surge has also created a new gap within the wealthy, or at least between millionaires and the so-called affluent. According to Spectrem, the number of households worth $1 million or more, and $5 million or more is near the record. But the number of households worth $500,000 or more (the affluent) is much lower than the record in 2007. There are 14.3 million households worth $500,000 or more â down from 15.7 million in 2007. Why the growing wealth gap within the wealthy? Catherine McBreen, president of Spectrem Group's Millionaire Corner, said that millionaire households held more stocks -- and therefore have benefited more from the market's run-up. It's not just a matter of money. Wealthier households also tended to make better investments, or at least more bullish ones, staying in the market during the recession while less wealthy investors bailed out. Affluent households had more than half their investable assets in some kind of equities in 2005, but in 2012 it dropped to a third. Millionaire households have 71 percent of their investable assets in some form of equities -- up from 61 percent in 2005. "The reason the affluents haven't recovered as quickly is their stock holdings," McBreen said. "Many of them simply pulled out of the market. They have more cash. But more of the high-net-worth households stayed in." She said the millionaire households were more likely to be older and retired, so they could afford to keep more money in the market. "The affluent group may be high earners, but they also might have high expenses like college tuition."
There's lots of broke millionaires. You know making a million, but living like you make $2 million, etc. Lots of folks with the big homes who are near or already broke---
I agree, I have a friend in the home improvement business and he tells me stories about people wanting to do the work but wanting it at a low cost and staying extremely in their budget, you know people who havent done work to their homes in over 20-30 years! They dont want to spend, and when they hear the prices of a new bathroom or new addition they say no way, the prices have gotten out of control over the last 10 years, you would have thought the financial crisis would have worked in favor for the consumer, you know bringing the prices of goods and services down, however the opposite has happened, the costs of services and goods has skyrocketed over the last 5-10 years, just go out there and price up a new walk way or a new bathroom or kitchen, its not cheap at all! Bubble ben didnt allow the market to be wiped clean, he put an imaginary floor under it by pumping it with cheap money policies and worthless dollars, this has created a totally uneven playing field that is going completely unnoticed, 2007 crisis was suppose to be the time the economy was suppose to start fresh again, but they didnt allow that to happen and because of that prices are out of control and asset bubbles are inflated once again, and speaking of housing, a house near by sold for around $200,000 in December, they came in fixed it up, new bathrooms and new kitchen, flooring etc, maybe sunk at most $75-$100k in 3 months, its now on the market for $550,000+ something is wrong here! Feels like 2006 all over again!
there is so much old money in places like california and new york, almost everyone in the neighborhood i grew up in as a child is an accidental millionaire, although it was middle class. instead of laughing off millionaires as really broke, people should realize a million is really nothing. with inflation it's like having $350,000 in 1980. it's enough to me to never work again, but's that precisely because i'll drive a used honda the rest of my life and investing in different asset classes is my favorite hobby.
+1 ... even if I can afford a luxury car, I will stick with my mazda3... I already drove BMW and MB a few years ago... it feels good not having a $1K a month car payment...
Mercedes, Audi and BMWs arent as luxury as they once were, I know a kid who works at the local pizza shop, he is probably in his early 20's driving a C300, leasing it for about $350 a month. He just left his BMW lease... Seems like many kids these days are driving luxury cars, either they live rent free or spend every dime they have to look cool, I dont know which one it is, but a luxury vehicle for the wealthy isnt a MB or BMW anymore, maybe 32 years ago you saw doctors and lawyers driving them, but today people working in retail and working a basic 9-5 job can lease a BMW all day long for $500 a month.....Its nothing out of the ordinary to see a $50k+ on the road these days even in areas where the median income is $47,000 a year! But back to a million dollars, its not enough to really retire on unless you live a really simple life, that means driving a used car, eating out maybe once a week, a trip once a year, with taxes and the cost of living driving higher a million does not get you far these days, a simple house can cost upwards of $10,000-$20,000 a year in taxes, my friends taxes just went up $1200 a year. So a million can come and go very quickly especially in this inflated economy!
That's me all right. I am trying to price some renovations for my apartment and want it cheap (no granite counter-tops, please) - seems like contractors think that I am flush with cash and that I will listen to their bullshit. Anway, some simple analysis. Once you actually think about it, 9 million households is a pretty small number - it is less then 3% of the US population. However, the meaty part is in the age groups. The median age of this group is 61 and the age distribution of that population is pretty stark (Fidelity Outlook): 29% 67+ 42% 57-66 20% 48-56 8% 21-47 This roughly means that if someone on this board is a millionaire and he's under 45, he is in the top .3% of the population by net worth. Not a super-star, but not a loser either.
It is so much more satisfying becoming a millionaire when the bubble bursts as apposed to this old fashioned way. Plus there are fewer people that will do it so you should potentially become a bigger millionaire much faster. When the fed stops buying and rates spike what else should I do besides outright shorting bonds?
wait. Of course the rich get richer, because on average (and I really stress average here!!!!!!) getting rich correlates positively with being smart and making the right choices at the right time. So there is no reason to assume that someone who made a fortune will lose it all in the next cycle, he/she will most likely be able to grow the fortune further. (On avergage). The poor person (on average) is a lot less intelligent and makes on average poor choices and stupid decisions, such as smoking, gambling, day trading, with money he/she cannot afford to lose. Also poor people ironically take way too much risk because they believe they do not have too much to lose but the potential payout could be huge. Thats why the poor and dumb generally play the lottery. Now this all applies to an environment such as the United States where there are abundant opportunities for the hardworking, smart, and diligent person. It may not apply in parts of Africa, for example, where favoritism and despotism keeps all the opportunities in the hands of a few families that own it all. But the concept really is that easy. I am not sure what you are confused about.