Best of the Week
Most Popular
1. Stock Markets and the History Chart of the End of the World (With Presidential Cycles) - 28th Aug 20
2.Google, Apple, Amazon, Facebook... AI Tech Stocks Buying Levels and Valuations Q3 2020 - 31st Aug 20
3.The Inflation Mega-trend is Going Hyper! - 11th Sep 20
4.Is this the End of Capitalism? - 13th Sep 20
5.What's Driving Gold, Silver and What's Next? - 3rd Sep 20
6.QE4EVER! - 9th Sep 20
7.Gold Price Trend Forecast Analysis - Part1 - 7th Sep 20
8.The Fed May “Cause” The Next Stock Market Crash - 3rd Sep 20
9.Bitcoin Price Crash - You Will be Suprised What Happens Next - 7th Sep 20
10.NVIDIA Stock Price Soars on RTX 3000 Cornering the GPU Market for next 2 years! - 3rd Sep 20
Last 7 days
Who is Spreading the Virus? UK Coronavirus 2nd Wave Analysis - 30th Sep 20
Gold And Silver Follow Up & Future Predictions For 2020 & 2021 – Part II - 30th Sep 20
The Only Thing Systematic Is The Destruction Of America - 29th Sep 20
Fractional-Reserve Banking Is The Elephant In The Room - 29th Sep 20
Gold And Silver Follow Up & Future Predictions For 2020 & 2021 – Part I - 29th Sep 20
Stock Market Short-term Reversal - 29th Sep 20
How Trump co-opted the religious right and stacked the courts with conservatives - 29th Sep 20
Which RTX 3080 GPU to BUY and AVOID! Nvidia, Asus, MSI , Palit, Gigabyte, Zotac, MLCC vs POSCAPS - 29th Sep 20
Gold, Silver & HUI Stocks Big Pictures - 28th Sep 20
It’s Time to Dump Argentina’s Peso - 28th Sep 20
Gold Stocks Seasonal Plunge - 28th Sep 20
Why Did Precious Metals Get Clobbered Last Week? - 28th Sep 20
Is The Stock Market Dow Transportation Index Setting up a Topping Pattern? - 28th Sep 20
Gold Price Setting Up Just Like Before COVID-19 Breakdown – Get Ready! - 27th Sep 20
UK Coronavirus 2nd Wave SuperMarkets Panic Buying 2.0 Toilet Paper , Hand Sanitisers, Wipes... - 27th Sep 20
Gold, Dollar and Rates: A Correlated Story - 27th Sep 20
WARNING RTX 3080 AIB FLAWED Card's, Cheap Capacitor Arrays Prone to Failing Under Load! - 27th Sep 20
Boris Johnson Hits Coronavirus Panic Button Again, UK Accelerting Covid-19 Second Wave - 25th Sep 20
Precious Metals Trading Range Doing It’s Job to Confound Bulls and Bears Alike - 25th Sep 20
Gold and Silver Are Still Locked and Loaded… Don't be Out of Ammo - 25th Sep 20
Throwing the golden baby out with the covid bath water - Gold Wins - 25th Sep 20
A Look at the Perilous Psychology of Financial Market Bubbles - 25th Sep 20
Corona Strikes Back In Europe. Will It Boost Gold? - 25th Sep 20
How to Boost the Value of Your Home - 25th Sep 20
Key Time For Stock Markets: Bears Step Up or V-Shaped Bounce - 24th Sep 20
Five ways to recover the day after a good workout - 24th Sep 20
Global Stock Markets Break Hard To The Downside – Watch Support Levels - 23rd Sep 20
Beware of These Faulty “Inflation Protected” Investments - 23rd Sep 20
What’s Behind Dollar USDX Breakout? - 23rd Sep 20
Still More Room To Stock Market Downside In The Coming Weeks - 23rd Sep 20
Platinum And Palladium Set To Surge As Gold Breaks Higher - 23rd Sep 20
Key Gold Ratios to Other Markets - 23rd Sep 20
Watch Before Upgrading / Buying RTX 3000, RDNA2 - CPU vs GPU Bottlenecks - 23rd Sep 20
Online Elliott Wave Markets Trading Course Worth $129 for FREE! - 22nd Sep 20
Gold Price Overboughtness Risk - 22nd Sep 20
Central Banking Cartel Promises ZIRP Until at Least 2023 - 22nd Sep 20
Stock Market Correction Approaching Initial Objective - 22nd Sep 20
Silver Bulls Will Be Handsomely Rewarded - 21st Sep 20
Fed Will Not Hike Rates For Years. Gold Should Like It - 21st Sep 20
US Financial Market Forecasts and Elliott Wave Analysis Resources - 21st Sep 20
How to Avoid Currency Exchange Risk during COVID - 21st Sep 20
Crude Oil – A Slight Move Higher Has Not Reversed The Bearish Trend - 20th Sep 20
Do This Instead Of Trying To Find The “Next Amazon” - 20th Sep 20
5 Significant Benefits of the MT4 Trading Platform for Forex Traders - 20th Sep 20
A Warning of Economic Collapse - 20th Sep 20
The Connection Between Stocks and the Economy is not What Most Investors Think - 19th Sep 20
A Virus So Deadly, The Government Has to Test You to See If You Have It - 19th Sep 20
Will Lagarde and Mnuchin Push Gold Higher? - 19th Sep 20
RTX 3080 Mania, Ebay Scalpers Crazy Prices £62,000 Trollers Insane Bids for a £649 GPU! - 19th Sep 20
A Greater Economic Depression For The 21st Century - 19th Sep 20
The United Floor in Stocks - 19th Sep 20
Mobile Gaming Market Trends And The Expected Future Developments - 19th Sep 20
The S&P 500 appears ready to correct, and that is a good thing - 18th Sep 20
It’s Go Time for Gold Price! Next Stop $2,250 - 18th Sep 20
Forget AMD RDNA2 and Buy Nvidia RTX 3080 FE GPU's NOW Before Price - 18th Sep 20
Best Back to School / University Black Face Masks Quick and Easy from Amazon - 18th Sep 20
3 Types of Loans to Buy an Existing Business - 18th Sep 20
How to tell Budgie Gender, Male or Female Sex for Young and Mature Parakeets - 18th Sep 20
Fasten Your Seatbelts Stock Market Make Or Break – Big Trends Ahead - 17th Sep 20
Peak Financialism And Post-Capitalist Economics - 17th Sep 20
Challenges of Working from Home - 17th Sep 20
Sheffield Heading for Coronavirus Lockdown as Covid Deaths Pass 432 - 17th Sep 20
What Does this Valuable Gold Miners Indicator Say Now? - 16th Sep 20
President Trump and Crimes Against Humanity - 16th Sep 20
Slow Economic Recovery from CoronaVirus Unlikely to Impede Strong Demand for Metals - 16th Sep 20
Why the Knives Are Out for Trump’s Fed Critic Judy Shelton - 16th Sep 20
Operation Moonshot: Get Ready for Millions of New COVAIDS Positives in the UK! - 16th Sep 20
Stock Market Approaching Correction Objective - 15th Sep 20
Look at This Big Reminder of Dot.com Stock Market Mania - 15th Sep 20
Three Key Principles for Successful Disruption Investors - 15th Sep 20
Billionaire Hedge Fund Manager Warns of 10% Inflation - 15th Sep 20
Gold Price Reaches $2,000 Amid Dollar Depreciation - 15th Sep 20
GLD, IAU Big Gold ETF Buying MIA - 14th Sep 20
Why Bill Gates Is Betting Millions on Synthetic Biology - 14th Sep 20
Stock Market SPY Expectations For The Rest Of September - 14th Sep 20
Gold Price Gann Angle Update - 14th Sep 20
Stock Market Recovery from the Sharp Correction Goes On - 14th Sep 20
Is this the End of Capitalism? - 13th Sep 20
The Silver Big Prize - 13th Sep 20
U.S. Shares Plunged. Is Gold Next? - 13th Sep 20
Why Are 7,500 Oil Barrels Floating on this London Lake? - 13th Sep 20
Sheffield 432 Covid-19 Deaths, Last City Centre Shop Before Next Lockdown - 13th Sep 20
Biden or Trump Will Keep The Money Spigots Open - 13th Sep 20
Gold And Silver Up, Down, Sideways, Up - 13th Sep 20

Market Oracle FREE Newsletter

How to Get Rich Investing in Stocks by Riding the Electron Wave

Income Inequality - Richer Than You

Politics / Social Issues May 03, 2013 - 03:30 PM GMT

By: Richard_Mills

Politics

Income inequality in Canada and the United States is on the rise. Read on to learn the real reason why…

The Canadian Centre for Policy Alternatives (CCPA) analysis of income inequality data shows the richest one percent of Canadians make $180,000 more today - adjusted for inflation - than they did in 1982.


The bottom 90 percent of Canadians saw income gains of only $1,700 over the same time period. In Vancouver, Toronto, and Montreal - Canada’s three largest cities - the bottom 90 percent actually make less today than they did in 1982.

 Most Canadians living in these cities have seen drops in income of:

  • Vancouver = $4,300
  • Toronto = $1,900
  • Montreal = $224

The richest one percent of Canadians in these three cities cities saw pay increases of:

  • Vancouver = $189,000
  • Toronto = $297,000
  • Montreal = $162,000

There are shocking disparities in income inequality in America…

David Cay Johnston, a Pulitzer Prize winner writing for Tax Analysts says that between 1966 and 2011, average inflation-adjusted income of the bottom 90 percent of US workers grew by just $59 while the income of the top 10 percent of workers grew by $116,071 - an astonishing, and frightening, 1,967 times the bottom 90 percent income growth rate.

The top one percent have enjoyed 81 percent of all the increased income since 2009.

The truly astonishing fact here is that it takes only $110k a year to be a top 10 percent earner in the U.S.! Getting into the top one percent is a stretch being over three times higher at $366k while joining the exclusive top .01 percent takes a whopping $8 million yearly income. In Canada, to join the top one percent club of 255,000 taxpayers, your income would have to have exceeded $200k. The threshold for the 25,475 Canadians that make up the top 0.1 percent was $685,000.00 of income.

Why such growth in income inequality?

Most would tell you, are telling you, it’s because…

Stocks and bonds are going up while the housing market remains flat. The top 10 percent have most of their wealth concentrated in stocks etc., less affluent households have their wealth in the value of their home - housing prices remain well below their 2006 peak while U.S. stock indices have all recently hit records.

Some will say falling top marginal tax rates in Canada explain part of the wealth disparity and income rise for the richest one per cent in that country.

A few will point out that the increase in inequality, in both countries, can also be attributed to institutional forces:

  • Declines in unionization rates
  • Stagnating minimum wage rates
  • Deregulation
  • National policies that favor the wealthy

All the reasons above show why the bottom 90 percent are getting poorer or at best have stagnating incomes but at best they explain only partially why the income gap is widening.

Consider what Stephen McNamee and Robert Miller, authors of The Meritocracy Myth have to say:

  • 20% of American households receive 50% of all available income  
  • The lowest 20% of households receive less than 4%
  • The top 5% of households receive 22% of all available income
  • The richest 1% of households account for 30% of all available net worth
  • Economic inequality in the U.S. is the highest among all industrial countries

The Wall Street Journal reported the top .01 percent (14,000 American families) hold 22.2 percent of wealth, and the bottom 90 percent (133 million families), just 4 percent of the nation's wealth.

In 1980 the richest one percent of America took home 1 of every 15 income dollars. Now they take home 3 of every 15 income dollars. Over the last 30 odd years the share going to the richest 0.01 per cent quadrupled, from one percent to almost five percent.

Why are the rich getting so much richer? It’s obviously more of a long term trend then something that just recently started to happen, what’s going on?

Executive Compensation: A New View from a Long-Term Perspective, 1936–2005

Carola Frydman, M.I.T. Sloan School of Management and NBER, Raven E. Saks Federal Reserve Board of Governors

Lavish Compensation

The super affluent have historically relied mostly on unearned income from financial assets, stocks and bonds etc., but for the last three decades that income has slowly taken a backseat to the compensation they are paid.

Canadian Centre for Policy Alternatives researcher Armine Yalnizyan found

“the income of the richest 1 per cent is due mostly to the lavish sums they are paid for the work they do.”

Paul Krugman, winner of the 2008 Nobel Prize in Economics says asset ownership by the super-rich “Is no longer the main source of elite status. These days even multimillionaires get most of their income in the form of paid compensation for their labor…Needless to say we’re not talking about wage slaves toiling for an hourly rate. If the quintessential high-income American circa 1905was an industrial baron who owned factories, his counterpart a hundred years later is a top executive, lavishly rewarded for his labors with bonuses and stock options. Even at the very top, the highest 0.01 percent of the population—the richest one in ten thousand—almost half of income comes in the form of compensation.”

USA Today's 2012 CEO’s Compensation analysis focused on 170 S&P 500 companies that filed proxies since Jan. 1, 2013, and were processed by March 22.

The median amount CEOs took home in 2012, including cash bonuses and stock and options awarded in previous years that vested or were cashed in, was $10.2 million.

Pay and total compensation numbers listed in USA Today’s report are incredible, here’s just four of the many:

Miles White, Abbott Labs, $19 million

David Pyott, Allergan, $19.4 million

Kenneth Chenault, American Express, $28 million

Randall Stephenson, AT&T, $21 million

CEO Pay and You, aflcio.org

Conclusion

It would seem the rich, in both Canada and the U.S., are getting richer while everyone else is getting poorer.

“Only twice before over the last century has 5 percent of the national income gone to families in the upper one-one-hundredth of a percent of the income distribution…Such concentration at the very top occurred in 1915 and 1916, as the Gilded Age was ending, and again briefly in the late 1920s, before the stock market crash…The great fortunes today are largely a result of the long bull market in stocks, Mr. Volcker said. Without rising stock prices, stock options would not have become a major source of riches for financiers and chief executives. Stock prices rise for a lot of reasons, Mr. Volcker said, including ones that have nothing to do with the actions of these people. The market did not go up because businessmen got so much smarter.” Louis Uchitelle, The Richest of the Rich, Proud of a New Gilded Age

The truth of, and the consequences from, such lopsided income inequality and wealth disparity should be on all our radar screens. Is it on yours?

If not, maybe it should be.

By Richard (Rick) Mills

www.aheadoftheherd.com

rick@aheadoftheherd.com

If you're interested in learning more about the junior resource and bio-med sectors please come and visit us at www.aheadoftheherd.com

Site membership is free. No credit card or personal information is asked for.

Richard is host of Aheadoftheherd.com and invests in the junior resource sector.

His articles have been published on over 400 websites, including: Wall Street Journal, Market Oracle, SafeHaven , USAToday, National Post, Stockhouse, Lewrockwell, Pinnacledigest, Uranium Miner, Beforeitsnews, SeekingAlpha, MontrealGazette, Casey Research, 24hgold, Vancouver Sun, CBSnews, SilverBearCafe, Infomine, Huffington Post, Mineweb, 321Gold, Kitco, Gold-Eagle, The Gold/Energy Reports, Calgary Herald, Resource Investor, Mining.com, Forbes, FNArena, Uraniumseek, Financial Sense, Goldseek, Dallasnews, Vantagewire, Resourceclips and the Association of Mining Analysts.

Copyright © 2013 Richard (Rick) Mills - All Rights Reserved

Legal Notice / Disclaimer: This document is not and should not be construed as an offer to sell or the solicitation of an offer to purchase or subscribe for any investment. Richard Mills has based this document on information obtained from sources he believes to be reliable but which has not been independently verified; Richard Mills makes no guarantee, representation or warranty and accepts no responsibility or liability as to its accuracy or completeness. Expressions of opinion are those of Richard Mills only and are subject to change without notice. Richard Mills assumes no warranty, liability or guarantee for the current relevance, correctness or completeness of any information provided within this Report and will not be held liable for the consequence of reliance upon any opinion or statement contained herein or any omission. Furthermore, I, Richard Mills, assume no liability for any direct or indirect loss or damage or, in particular, for lost profit, which you may incur as a result of the use and existence of the information provided within this Report.

Richard (Rick) Mills Archive

© 2005-2019 http://www.MarketOracle.co.uk - The Market Oracle is a FREE Daily Financial Markets Analysis & Forecasting online publication.


Post Comment

Only logged in users are allowed to post comments. Register/ Log in

6 Critical Money Making Rules