Advertise | Bookmark | Contact Us | E-Mail List |  | Update Page | UraniumSeek.com 

Commentary : Gold Review : Markets : News Wire : Quotes : Silver : Stocks - Main Page 

 GoldSeek.com >> News >> Story  Disclaimer 
 
Latest Headlines

Gold Seeker Weekly Wrap-Up: Gold and Silver Gain Over 1% and 2% on the Week
By: Chris Mullen, Gold Seeker Report

Ira Epstein's Metals Video 11 17 2017
By: Ira Epstein

Next-Generation Crazy: The Fed Plans For The Coming Recession
By: John Rubino

COT Gold, Silver and US Dollar Index Report - November 17, 2017
By: GoldSeek.com

Gold Miners’ Q3’17 Fundamentals
By: Adam Hamilton, CPA

Bonfire of the Absurdities
By: John Mauldin

The Social Security Inflation Lag Calendar - Partial Indexing Part 1
By: Daniel R. Amerman, CFA

Rob From The Middle Class Economics
By: Gary Christenson

GoldSeek Radio Nugget: John Williams and Chris Waltzek
By: radio.GoldSeek.com

The Metals Market Is A Mess And Will Likely Continue To Frustrate You
By: Avi Gilburt

 
Search

GoldSeek Web

 
Kim Kardashian, Millionaire Cops and the 1%


 -- Published: Thursday, 20 October 2016 | Print  | Disqus 

By Peter Diekmeyer

Recent reports suggest that Kim Kardashian is pulling back from social media, in the wake of a reported $10 million robbery of her jewelry by Paris assailants.

The move, which according to sister Kourtney, is being made “just [to] make sure we’re protected as well as possible,” illustrates a lesson the nouveau riche often learn the hard way: it generally pays to be discreet about wealth.

Consider the contrasting positions of two classes of millionaires. The first is the 1% of income earners, whose wealth has attracted increased attention in recent years.

The second is government employees with gold-plated pension plans, often worth millions, whose wealth generally passes unnoticed.

Dangers to the 1%

Like Kim Kardashian’s jewels, the assets and incomes of the 1% have attracted enormous attention in recent years from a group far more effective at wealth appropriation than mere thieves: governments.

As Nobel laureate Joseph Stiglitz noted at a presentation in Quebec City earlier this month: “Incomes of the top 1% of the population have been growing exponentially for the past three or four decades, while those of the bottom 90% have stagnated. We have more money at the top, more people in poverty and the middle class is being eviscerated.”

Stiglitz echoes ideas of Thomas Piketty, author of Capital in the Twenty-First Century, and others, who argue that governments should tax the super-rich more, to finance public services and to flatten income inequality.

Never mind that most, if not all of the relative wealth increases that have accrued to the top 1% in recent years, are the result government’s own asset inflation policies. The fact that seizures of even all of the 1%’s assets would hardly make a dent in public sector debts matters little either.

Nor does the fact that most of the 1% would far prefer sound money and a more sustainable economic model than the existing debt-growth model.

What matters is that the wealth and earnings of the 1% are visible and thus a target. That means it is subject to seizure at the stroke of the pen, by any group of populist politicians looking for an easy issue.

Millionaire cops: wealth management experts

Contrast the plight of the 1% with another particularly astute group of millionaires: North America’s government employees, a huge percentage of them who will retire extremely wealthy, due to the cash-in values of gold-plated pension plans, which are financed and guaranteed in large part by taxpayers.

One example: according to a government web-site, a Quebec Provincial Police officer, who retires at age 55, with 30 years of service, will take in nearly $50,000 a year in benefits. If he collects during his 25+ years in life expectancy, he’ll rake in cool $1.25 million. After that his spouse will collect survivors’ benefits. And that is for a lowly beat cop. Higher ranking public sector officials collect far more.

The key is that those millionaire government employees, collect their wealth quietly, without attracting public notice. Often their salaries are far lower than they appear, because the present value of their future pension benefits are excluded.

Governments also gain, because they can increase public sector workers’ pay (and their own salaries), without recording the expenses, merely by boosting future pension benefits, rather than paying them through more visible salary increases.

The takeaway for investors


There are key lessons in the plights of Kim Kardashian, the 1% and the millionaire cops, for ordinary savers too.

In a debt-fueled economy, in which the US Federal Reserve estimates that 46 percent of Americans are so tapped out they couldn’t come up with $400 bucks to cover an emergency expense, it probably pays to keep quiet about any hard, moveable, assets.

In addition, assets which fewer people know about - like gold-plated government pension plans - have sustainable preservation characteristics, which are hard to ignore during tough economic times.

Sprott Money General Banner (125x125)

Visit SprottMoney



Peter Diekmeyer is a business writer/editor with Sprott Money News, the National Post and Canadian Defence Review. He has studied in MBA, CA and Law programs and filed reports from more than two dozen countries.


The views and opinions expressed in this material are those of the author as of the publication date, are subject to change and may not necessarily reflect the opinions of Sprott Money Ltd. Sprott Money does not guarantee the accuracy, completeness, timeliness and reliability of the information or any results from its use.


| Digg This Article
 -- Published: Thursday, 20 October 2016 | E-Mail  | Print  | Source: GoldSeek.com

comments powered by Disqus



 



Increase Text SizeDecrease Text SizeE-mail Link of Current PagePrinter Friendly PageReturn to GoldSeek.com

 news.goldseek.com >> Story

E-mail Page  | Print  | Disclaimer 


© 1995 - 2017



GoldSeek.com Supports Kiva.org

© GoldSeek.com, Gold Seek LLC

The content on this site is protected by U.S. and international copyright laws and is the property of GoldSeek.com and/or the providers of the content under license. By "content" we mean any information, mode of expression, or other materials and services found on GoldSeek.com. This includes editorials, news, our writings, graphics, and any and all other features found on the site. Please contact us for any further information.

Live GoldSeek Visitor Map | Disclaimer

The views contained here may not represent the views of GoldSeek.com, its affiliates or advertisers. GoldSeek.com makes no representation, warranty or guarantee as to the accuracy or completeness of the information (including news, editorials, prices, statistics, analyses and the like) provided through its service. Any copying, reproduction and/or redistribution of any of the documents, data, content or materials contained on or within this website, without the express written consent of GoldSeek.com, is strictly prohibited. In no event shall GoldSeek.com or its affiliates be liable to any person for any decision made or action taken in reliance upon the information provided herein.