All mine – How the Super-Rich Devalue their Own Wealth
Aspirations to grow and outgrow others seem human. We want always more and bigger. Our economy reflects this with giants like Google, Facebook, Apple and Amazon having popped up in no time. The social consequence of this development is the much talked about growing division between rich and poor.
“…the three wealthiest individuals in the world have assets
that exceed those of the poorest 10 percent of the world’s population.
The net worth of the world’s billionaires increased from less than $1 trillion in 2000
to over $7 trillion in 2015 so the gap is growing up dramatically.”
A book I read to my children (“Alles Meins. Oder 10 Tricks wie man alles kriegen kann” – You can buy it on Amazon, of course :P) sums up the effect well: A young raven, eager to have more and more toys, starts collecting, stealing and hiding toys in its nest, leaving the other animals in the forest with fewer toys every day. The other animals start inventing new games among them, leaving the raven with no friends to play with, but all the toys. In the end, the raven prefers sharing the toys and playing with the other animals rather than sitting alone on all his belongings he cannot really use by himself.
People are doing the same thing with money
The more only a few people possess, the less it becomes worth.
In economics and in physics, to study a phenomenon, one takes it to the extreme. So let´s say one person owns all the money in the world. Since money is merely a tool for exchanging goods and services more easily, if one person has all the purchasing power, only one person could consume anything. Anything money can buy that is.
Since we all have to eat, sleep somewhere and no matter how little money we have still find entertainment in something, money ceases to be the representation of wealth.
In the extreme case of one person having all, money ceases to be worth anything at all.
The beginnings of this tendency have been visible for years. From exchange platforms to car sharing, there are more and more business models based on sharing and exchanging digital and physical goods, property and even time. The effect is that less money is flowing in the economy, which is logical when people have less money. For the last few years, I have “paid” a large part of my vacation homes by letting other families stay in my house while we are gone. Not only am I not paying for my stay, but I also don´t need anyone to water my plants in my house, no one to feed my cats nor an alarm to protect my home. In one occasion, I even agreed with the exchange family to throw our cars into the exchange deal, which made the rental car unnecessary as well.
People find solutions – with or without money.