This is another one of those days when I read the NY Times and just want to bang my head against a wall:
Nordstrom has a waiting list for a Chanel sequined tweed coat with a $9,010 price. Neiman Marcus has sold out in almost every size of Christian Louboutin “Bianca” platform pumps, at $775 a pair. Mercedes-Benz said it sold more cars last month in the United States than it had in any July in five years.
Even with the economy in a funk and many Americans pulling back on spending, the rich are again buying designer clothing, luxury cars and about anything that catches their fancy. Luxury goods stores, which fared much worse than other retailers in the recession, are more than recovering — they are zooming. Many high-end businesses are even able to mark up, rather than discount, items to attract customers who equate quality with price.
“If a designer shoe goes up from $800 to $860, who notices?” said Arnold Aronson, managing director of retail strategies at the consulting firm Kurt Salmon, and the former chairman and chief executive of Saks.
The rich do not spend quite as they did in the free-wheeling period before the recession, but they are closer to that level.
The luxury category has posted 10 consecutive months of sales increases compared with the year earlier, even as overall consumer spending on categories like furniture and electronics has been tepid, according to the research service MasterCard Advisors SpendingPulse. In July, the luxury segment had an 11.6 percent increase, the biggest monthly gain in more than a year.
Yeah. That’s a real shock. What part of HIGHEST CONCENTRATION OF WEALTH SINCE THE 20’s DON’T YOU UNDERSTAND? Jeebus:
As you can see, the nation’s income distribution may be quite lopsided, but its wealth distribution is even more so.
The top 1 percent of earners receive about a fifth of all American income; on the other hand, the top 1 percent of Americans by net worth hold about a third of American wealth. (Note that the top income earners are not necessarily the same people as the top net-worth Americans — after all, lots of high-net-worth people don’t work or have much else in the way of sources of new income.) Wealth-related inequality has also been relatively stable over the last few decades, whereas income-related inequality has been growing since the ’70s.
Why is there more inequality in wealth than in income, both today and yesterday?
Remember that wealth accumulates over time. The highest earners are able to save much of their incomes, whereas lower earners can’t. That means high earners can accumulate more and more wealth as time goes on (assuming they don’t blow it all, of course).
Higher-earning Americans also have the resources to pay for better tax preparation, which helps them reduce their taxes and save even more money. On the tax front, note also that people who have already accumulated wealth stand to earn a lot in capital gains, which are also taxed at a lower rate.
Our Galtian overlords have the most money they ever have, their taxes are at the lowest levels they have in many decades, and they have plenty of money to blow on luxury items. Why? BECAUSE THEY HAVE ALL THE FUCKING MONEY. It’s no coincidence that luxury items are flying off the shelves while concomitantly, the middle class is slowing down their spending on food, furniture, etc. In fact, this is precisely the point many dirty hippies have been trying to make- we are never going to have an economic recovery until some people other than the Kochs and Warren Buffet have money to spend. And with unemployment at astronomical levels and with the official government policy to make things worse with austerity and then hope a magical unicorn comes sliding down a rainbow showering jobs on the middle class, it is going to stay this way. Fer fuck’s sake.
Meanwhile, while all this is going on, our elites are blowing sloppy wet kisses to wingnuts like David Frum who finally realize “Hey- Maybe Krugman knows what he is talking about and Stephen Moore and the other hacks at the WSJ are clueless.” We’re so screwed.