THE SET-UP: I can’t think of a better way to wrap-up the Year Of The Oligarch … or, to put a finer point on it, the year that one of surveillance capitalism’s so-called “geniuses” actively hacked the political system and inserted himself as both a potent powerbroker and a leading power-player. Amazingly, Musk’s entry into the political system generated a massive financial windfall … but it was not rooted in sales or revenue or profit. Investors flocked to him because of his proximity to political power.
And now that he’s exercising real political power? Forgetta-bout it.
He may achieve exit velocity from the economic gravity that governs the rest of us. In fact, years of post-Crash hoarding may have given the Tech Broligarchs and venture capitalists and private equity so much capital … the supply side can now play with the economy without fear of ever being punished by market fundamentals or, thanks to Musk’s “political disruption,” by political blowback.
It’s still early … but if Musk doesn’t eff it up, he might’ve “liberated” himself and his peers from the social and political constraints that govern the mere mortals struggling to keep up on the demand side of the economy. - jp
TITLE: How Wealthy Are You? Here's A Look At The Net Worth You Need To Rank In The Top 10%, 5% and 1%
https://www.benzinga.com/personal-finance/24/12/42731749/how-wealthy-are-you-heres-a-look-at-the-net-worth-you-need-to-rank-in-the-top-10-5-and-1
EXCERPTS:
The Top 1%
To crack the top 1% – yes, the land of private jets and exclusive clubs – you need a net worth of $11.6 million, according to Federal Reserve Data. These are the ultra-wealthy and their financial cushion is less of a cushion and more of a king-size memory foam mattress. They hold a disproportionately large share of the country's wealth, making this club one of the hardest to join.
The Top 5%
Let's tone it down a notch if $11.6 million feels out of reach. A net worth of at least $1.17 million puts you solidly in the top 5%. This is where you can start throwing around words like "comfortable" and "affluent." At this level, you're likely enjoying a lifestyle with frequent vacations, a great home and significant financial security.
The Top 10%
To enter the top 10%, your net worth needs to hit $970,900, thanks to smart investing, home equity and diversified assets like retirement accounts and equities.
But what about the rest of us?
The top 20% is estimated at around $636,800, while the top 40% sits closer to $500,000. For perspective, the average net worth of households aged 45-54 is $975,800, meaning that if you're in that age range and cracking the top 10% feels impossible, you're not alone – it's a steep climb.
TITLE: World’s 500 Richest People Surpassed $10 Trillion in Wealth This Year
https://www.bloomberg.com/news/articles/2024-12-31/world-s-500-richest-billionaires-surpassed-10-trillion-in-wealth-in-2024?leadSource=uverify%20wall
EXCERPTS: The world’s 500 richest people got vastly richer in 2024, with Elon Musk, Mark Zuckerberg and Jensen Huang leading the group of billionaires to a new milestone: A combined $10 trillion net worth.
An indomitable rally in US technology stocks played a key role in turbocharging the trio’s wealth, as well as the fortunes of Larry Ellison, Jeff Bezos, Michael Dell and Google co-founders Larry Page and Sergey Brin. The eight tech titans alone gained more than $600 billion this year, 43% of the $1.5 trillion increase among the 500 richest people tracked by the Bloomberg Billionaires Index.
But it was Musk — the so-called “first buddy” of President-elect Donald Trump after unprecedented support for his reelection campaign — who dominated the world’s wealthiest in 2024.
His close relationship with the incoming president helped increase the value of his companies, including Tesla Inc., SpaceX and xAI. That boosted his fortune to an unprecedented $442.1 billion, up $213 billion from the beginning of the year. The $237 billion gap between him and Bezos on Dec. 17 was the largest ever recorded between the first- and second-ranked names on Bloomberg’s wealth index.
Across the board, the world’s wealthiest benefited from a stock market that defied expectations in 2024. The S&P 500 Index gained 24% through Monday, powered by the small group of stocks dubbed the “Magnificent Seven,” including Musk’s Tesla, Zuckerberg’s Meta Platforms Inc. and Huang’s Nvidia Corp., which accounted for more than half of the stock benchmark’s performance.
Trump’s election win added to the gains: The S&P 500 hit a then all-time high on Nov. 6 in its best post-Election Day performance in history. The billionaires represented on the index gained a combined $505 billion in the five weeks following the election, 34% of the yearly total.
Trump’s victory also sparked a historic rally for digital assets, pushing Bitcoin above $100,000 for the first time. That especially boosted crypto billionaires: Binance Holdings’ Changpeng Zhao, known as CZ, saw his wealth surge 60% to $55 billion. The net worth of Coinbase Global Inc. co-founder Brian Armstrong rose more than 50% to $11.1 billion.
The total value of the fortunes tracked by the Bloomberg Billionaires Index was $9.8 trillion at Monday’s close, down slightly from a Dec. 11 peak of $10.1 trillion following a post-Christmas selloff. Their wealth is similar in size to last year’s combined gross domestic products of Germany, Japan and Australia, according to data compiled by the World Bank.
TITLE: Stocks on Pace for Best Two Years in a Quarter-Century
https://www.wsj.com/finance/stocks/stocks-on-pace-for-best-two-years-in-a-quarter-century-c5b5f9b3
EXCERPTS: U.S. stocks roared to another blockbuster showing in 2024. Few expect such a torrid advance in the year to come.
The S&P 500 has climbed 24%, notching 57 record closes as the economy remained healthy, inflation ticked lower and an AI-fueled rally in big tech stocks powered on. Even with a stumble in the last few trading days, the broad U.S. stock index is on pace for its best consecutive years since 1997 and 1998, according to Dow Jones Market Data, during the lead-up to the bursting of the dot-com bubble.
The rally has created millionaires and turned professional investors increasingly bullish: In December, the Bank of America Global Fund Manager Survey found record enthusiasm for U.S. stocks, as measured by the net share of respondents favoring the group. The payoffs haven’t been limited to the equity market: Gold is on pace for its best year since 2010, while bitcoin more than doubled, vaulting above $100,000 for the first time before slipping below that mark.
The S&P 500 traded late last week at 21.9 times its projected earnings over the next 12 months, according to FactSet, above a 10-year average of 18.5 times. Some investors argue that the hefty presence of fast-growing tech stocks in today’s market justifies a richer multiple than in the past. But many still worry the market looks pricey.
By itself, a lofty price tag is unlikely to stop the rally. But it will weigh on the returns that investors can expect over the long term and heighten the importance of corporate profit growth to stock performance.
Wall Street analysts expect profits from companies in the S&P 500 to grow 15% in 2025, up from a projected 9.5% for 2024, according to FactSet. Traders look ready to punish companies that give reason to worry. Adobe shares recently dropped 14% in a day after the software maker offered weak sales guidance.
Over the past year, investors began to turn a more skeptical eye to the question of when companies’ spending on artificial intelligence will turn into profits. Shares of Google parent Alphabet and Amazon.com stumbled when investors looked askance at a pairing of heavy spending with signs of disappointing sales growth.
Even so, the biggest tech stocks continued to do much of the work of powering the S&P 500 higher. Through Dec. 24, the Magnificent Seven—Alphabet, Amazon, Apple, Meta Platforms, Microsoft, Nvidia and Tesla—accounted for more than 53% of the stock index’s total return, including dividends, according to S&P Dow Jones Indices. Nvidia alone made up 21% of the return, as the maker of artificial-intelligence chips saw its market value leap past $3 trillion.
TITLE: Homeownership Boom Widens the Wealth Gap, Leaving Renters in Financial Instability
https://sacobserver.com/2024/12/homeownership-boom-widens-the-wealth-gap-leaving-renters-in-financial-instability/
EXCERPT: A Profile on the Wealth and Financial Well-Being of Renter Households highlights that renters today have a median net worth of just $10,400—a mere fraction of homeowners’ nearly $400,000 median net worth. According to the Aspen Institute Financial Security Program’s report, “From Rent to Riches,” the disparity is not solely due to home equity. While home equity makes up $200,000 of homeowners’ median net worth, the remainder comes from other assets that renters typically do not own, such as stocks, bonds, retirement accounts, and business equity. The report notes that 78% of homeowners own a potentially appreciating asset beyond their primary residence, compared to only 48% of renters.
Just 39% of renter households have income exceeding their monthly expenses, compared to 54% of homeowners. The limited cash flow makes it difficult for renters to save, pay off debt, and invest in assets that can build wealth.
Renters saw a 43% increase in net worth between 2019 and 2022, outpacing the 34% increase for homeowners. Pandemic-era support measures helped to spur the growth, allowing many renters to reduce debt and invest some of their earnings, researchers said.
However, the end of support programs and rising housing costs reversed those gains.
Rent prices surged by 27% from early 2020 to August 2022, exacerbating financial strain. Half of all renter households now spend a reported more than 30% of their pre-tax income on rent, while 27% spend more than half of their income on housing. Experts said these rent burdens leave little room for saving or investing, perpetuating the cycle of financial instability.
The report identifies several systemic obstacles preventing renters from building wealth. Renters are more likely than homeowners to be burdened by student loan debt and late payments. Even though renters’ median debt decreased slightly in recent years, 18% still struggle with overdue payments, double the rate for homeowners. The median savings for renters is just $3,000, compared to $20,000 for the average household. Only 31% of renters have enough emergency savings to cover six weeks of expenses. Renters are also more likely to have subprime credit scores, limiting their ability to secure favorable loans for homes or businesses. Half of renters reported being denied credit or receiving less credit than requested, compared to 28% of homeowners.
SEE ALSO:
In Tennessee, Climbing Utility Rates and More Than 140,000 Household Cut-Offs in 2023
https://insideclimatenews.org/news/28122024/tennessee-climbing-utility-rates/
West Palm Beach feels growing pains amid wealth influx as neighborhoods navigate change
https://www.palmbeachpost.com/story/news/local/westpb/2024/12/31/west-palm-beach-becomes-more-like-wall-street-south-in-florida/77260621007/
Real Estate Experts: Could This Florida City Become the Next Ultra-Wealthy Hotspot?
https://www.gobankingrates.com/investing/real-estate/real-estate-experts-could-this-florida-city-become-the-next-ultra-wealthy-hotspot/