1/Today's @bopinion post is about getting rich.
The dream of getting rich is fundamental to the capitalist system. But in America, that dream is getting further out of reach.
bloomberg.com/opinion/articl…
2/Wealth mobility has decreased. It's less likely for people outside the top echelon to make it into that rarefied percentile.
clevelandfed.org/en/newsroom-an…
3/What's the classic way to get rich?
Start a business.
But fewer people are starting businesses.
4/Big chains have been muscling out local businesses, closing off an essential route into the upper middle class.
nber.org/chapters/c0487
And high-growth startups are becoming rarer as well.
econweb.umd.edu/~haltiwan/EER_…
Big corporations are taking over.
economics.mit.edu/files/12979
5/How about investing in other people's businesses?
If you bet big on Google or Amazon stock, you'd have a lot of money now. But most people who play that game lose.
So stock investing is being taken over by institutions.
pubs.aeaweb.org/doi/pdfplus/10…
6/How about real estate?
Middle-class Americans at least know how to play that game. But many were crushed in the crash.
bloomberg.com/opinion/articl…
7/House-flipping is still around, at least...
bloomberg.com/news/articles/…
8/But thanks to tighter lending standards and the entry of institutional investors into the housing market, even that is increasingly a game for those who already have money.
bloomberg.com/opinion/articl…
9/The crisis was a turning point for the wealth distribution in America.
10/What about making money by working hard and getting a top job?
Increasingly, that requires a degree from a top school...or an advanced degree.
statchatva.org/2019/05/10/a-g…
11/Getting a plum job is still within reach if you're a genius with a PhD. But what about everyone else?
bloomberg.com/opinion/articl…
12/And remember, even getting through college is very dependent on how much money your parents have.
13/Normal Americans, without rich parents or sky-high IQs, want a path to riches.
Maybe that explains the enthusiasm for crypto. In crypto, outsiders, rebels, and normal shmoes can still get rich.
I gave an impromptu speech about that on this podcast:
pscp.tv/EuclidAndOaks/…
14/But even in crypto, the big companies are coming in and taking over.
coindesk.com/rising-institu…
15/The basic story here is that big organizations are coming in and dominating all of the paths by which Americans traditionally could get rich.
And when people can't get rich, they look for other avenues to status and meaning.
16/If big organizations are allowed to continue to shut out young ambitious Americans, don't be surprised if the next hot growth industry...is socialism.
(end)
bloomberg.com/opinion/articl…
Share this Scrolly Tale with your friends.
A Scrolly Tale is a new way to read Twitter threads with a more visually immersive experience.
Discover more beautiful Scrolly Tales like this.