The richest 1 percent now owns more of the country’s wealth than at any time in the past 50 years

The richest 1 percent now owns more of the country’s wealth than at any time in the past 50 years, by Christopher Ingraham.

The wealthiest 1 percent of American households own 40 percent of the country’s wealth, according to a new paper by economist Edward N. Wolff. That share is higher than it has been at any point since at least 1962, according to Wolff’s data, which comes from the federal Survey of Consumer Finances. …

Today, the top 1 percent of households own more wealth than the bottom 90 percent combined. That gap, between the ultrawealthy and everyone else, has only become wider in the past several decades.

The trend in Australia is similar.

This is direct result of the central bank policies of low interest rates. Letting a bunch of bureaucrats set interest rates, instead of leaving them to the market, has led to a disastrous run of bubbles and recessions ever since they started early last century.

Financialization of the economy since going off the gold standard in 1970 has led to ever more profits in the finance industry and less in manufacturing, mining, agriculture, other services, etc. The guys who handle the money and create money out of thin air mysteriously seem to be getting richer than everybody else — odd, eh?

After the GFC in 2008, record low interest rates have allowed those with assets to borrow cheaply and buy more assets. As a result, every asset class is at nosebleed levels, and those with assets are making historically huge returns. (All assets except gold, whose price is suppressed by central banks because gold is a competitor for government money and because a high gold price indicates a lack of confidence in government money.)

By the way, it is fractional reserve banking that causes the “business” cycle of boom and bust. It was thought in the early days of socialism that central banks could tame that cycle, but they have only made it worse and then some. Fractional reserve banking was outlawed in Europe until the late 1600’s, but soon after its introduction the business cycle sparked up and finanical bubbles began appearing — such as the South Sea bubble of 1720 and the tulip bubble of 1637.