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about 1% (economist.com)

5 points by anovikov ↗ HN
What bugs me is how is it possible that while 1% in net worth starts with $6.9M, it is just $350K in income only a quarter of which, comes from financial assets. This implies 1.3% interest - unbelievably little. Any explanation?

2 comments

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anovikov
What bugs is me is how is it possible that the 6.9M in assets results in only 25% of the 350K income coming as interest - which is a 1.3% interest rate - seems to low for any reasonable investment (lower than inflation, for example)?
aac74
I think this article neatly sums up the problem. It is all about the 'financialisation' of the economy and yet it never mentions gold once ! Just like the film Margin Call. No gold at the base of the pyramid (i.e. capitalism without real always liquid capital) means that you can build a debt/derivatives pyramid to the moon. This monetary inflation only benefits the rich while creating the illusion of wealth below. However a return to gold would destroy big government too and this is why it can never be talked about. The reason interest on savings is so low is that the fed has had to rig rates at multi century lows to try and keep the debt party going. It has thus created the biggest bond bubble in all of financial history. The fed IS the bond market and can not exit without creating a crash.