Thursday, December 28, 2006

The Good News? You’re Rich. The Bad News? Never Rich Enough.

The richest 2% of adults in the world own more than half of all household wealth, according to a new study by a United Nations research institute.

The report, from the World Institute for Development Economics Research, reveals that the poorer half of the world's population own barely 1% of global wealth, highlighting the obvious – the ever growing disparity between the rich and the poor.

Where do you fit in the mix? The facts may surprise you.

You make the top half of the world's wealthiest people with just $2,200 in total assets. $61,000 in assets puts you in the top 10% And, if you have more than $500,000 after totaling up your house, cars, investments, 401(k) and all your personal property, you're part of the richest 1%.

But those facts don’t seem to provide much comfort to the haves, just as the fact that half the world, nearly 3 billion people, live on less than $2 a day, doesn’t seem to take the pain out of not having more.

Most don’t pat themselves on the back for being “rich,” revel in the fact they cannot even imagine what it means to be poor, or are one of the lucky ones who live in North America which accounts for just 6% of the world’s population but 34% of its wealth.

Ironically, that is not the way money works. Few take time to look down the ladder of success and appreciate their comparatively elevated position. Instead, most lament their fate – regretting that they are not as successful as those standing on the economic rungs above their own.

A good example? In recent weeks, massive riches have flowed to top bankers and traders. Investment houses like Goldman Sachs, Lehman Brothers and Morgan Stanley are awarding bonuses as high as $60 million to their star performers. And a there are a few hedge fund managers and private equity executives who will be taking home even more.

Young investment bankers in their late-20’s are struggling with the challenge of moving from $5 million Manhattan apartments to $10 million pads all the while lamenting that they still have to fly commercial while their bosses fly in their own jets.

Whether it is a travesty that half the world lives on less than $2 a day while orders for the $250,000 Ferrari 599 GTB Fiorano far exceed the number that will be built remains a debate that will continue to rage.

What we do know is that many, perhaps most, people in Western society suffer acute anxieties and insecurities brought on by the reality that there is always someone with more money, leaving mankind bound in the ultimate paradox – seeking more even though we know (or should know) that more never becomes enough if only because there is always more. And, even if more did become enough as the natural order of things, there is no evidence that being further up the economic ladder than required to provide food, shelter, clothing, and a basic education renders one any happier with their life over the long term.

Giving that a bit of time and thought before the end of this year might provide us with greater contentment and perhaps a healthy dose of shame from time to time when the newest gadget is just out of our reach.

Very best for a happy 2007.


Blogger Anna said...

Thanks, Jim, for the reminder of something we so often forget! Happy holidays!

3:51 PM  

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