Economists say the rising stock market is giving an added boost to consumer spending through what is known as the "wealth effect."

Key Points

  • The wealth of the top 1% hit a record $44.6 trillion at the end of the fourth quarter.
  • All of the gains came from stock holdings thanks to an end-of-year rally.
  • Economists say the rising stock market is giving an added boost to consumer spending through what is known as the “wealth effect.”

The wealth of the top 1% hit a record $44.6 trillion at the end of the fourth quarter, as an end-of-year stock rally lifted their portfolios, according to new data from the Federal Reserve.

The total net worth of the top 1%, defined by the Fed as those with wealth over $11 million, increased by $2 trillion in the fourth quarter. All of the gains came from their stock holdings. The value of corporate equities and mutual fund shares held by the top 1% surged to $19.7 trillion from $17.65 trillion the previous quarter.

While their real estate values went up slightly, the value of their privately held businesses declined, essentially canceling out all other gains outside of stocks.

  • Flying Squid
    1•8 months ago

    It is in no way the same idea.

    Communism is about the workers controlling the means of production and distributing things according to people’s needs. This has zero to do with that.

    I mean it’s not a secret what communism is, so I don’t know why you don’t know what it is, but here-

    https://en.wikipedia.org/wiki/Communism

    Also, Karl Marx wrote extensively on the subject. Believe it or not, limiting upper income levels was not something he ever wrote about. Probably because that wouldn’t even be a thing in a communist society.

          • Flying Squid
            1•8 months ago

            It’s almost as if they weren’t actually socialist countries.

            Next you’ll be telling me that the elections in the Democratic People’s Republic of Korea are unfair, which is why we shouldn’t have democracy.

              • Flying Squid
                1•8 months ago

                I don’t know, maybe because just because a country calls itself something doesn’t mean it actually follows that ideology?

                Believe it or not, the National Socialist German Workers’ Party were also not socialists.

                But I do enjoy how you keep ignoring the actual definitions of these words and instead are going with what countries do.

                  • Flying Squid
                    1•8 months ago

                    It’s oligarchy disguising itself as socialism. If the people at the top are far richer than the people at the bottom it is neither socialism nor communism. Period.

                    Capping income at an upper limit is also not communism or socialism. It is still capitalism.

                    Now that we’ve straightened that out, maybe you can explain why anyone needs to be worth more than $100 million.