Takeaways from the above:

  • more than half of American households own no stock
  • roughly 1/3 maintain indirect ownership and with the rise in passive strategies (i.e. indexing) have endowed giants like Vanguard with enormous voting power over corporations

Now consider the following:

 

  • 60% of American families combined own less than 2% of stock wealth
  • 10% of American households control 84% of stock wealth

Is this the result of hard work?  Is it exploitation at the hands of “greedy millionaires and billionaires?”  (Sorry Mr. Obama but you’ll never escape that.)  Is it interest upon interest accumulating to widows and idiot sons?  (Thank you Gordon Gekko for that gem.)

Whatever the cause the effect parallels widening social inequality.  The solution, however, is not to punish and bring down the upper end of the scale.  Instead, incentives need to be offered to raise the lower end.

Your move Washington.