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Who Rules America? An Investment Manager Breaks Down the Economic Top 1%, Says 0.1% Controls Political and Legislative Process

July 23rd, 2011 | Filed under Economy, Feature, News . Follow comments through RSS 2.0 feed. Click here to comment, or trackback.

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Sent in from G. William Domhoff, author of Who Rules America?

This article was written by an investment manager who works with very wealthy clients. I knew him from decades ago, but he recently e-mailed me with some concerns he had about what was happening with the economy. What he had to say was informative enough that I asked if he might fashion what he had told me into a document for the Who Rules America Web site. He agreed to do so, but only on the condition that the document be anonymous, because he does not want to jeopardize his relationships with his clients or other investment professionals.

Who Rules America? An Investment Manager Breaks Down the Economic Top 0.1%I sit in an interesting chair in the financial services industry. Our clients largely fall into the top 1%, have a net worth of $5,000,000 or above, and if working make over $300,000 per year. My observations on the sources of their wealth and concerns come from my professional and social activities within this group.

Work by various economists and tax experts make it indisputable that the top 1% controls a widely disproportionate share of the income and wealth in the United States. When does one enter that top 1%? (I’ll use “k” for 1,000 and “M” for 1,000,000 as we usually do when communicating with clients or discussing money; thousands and millions take too much time to say.) Available data isn’t exact. but a family enters the top 1% or so today with somewhere around $300k to $400k in pre-tax income and over $1.2M in net worth. Compared to the average American family with a pre-tax income in the mid-$50k range and net worth around $120k, this probably seems like a lot of money. But, there are big differences within that top 1%, with the wealth distribution highly skewed towards the top 0.1%.

The Lower Half of the Top 1%

The 99th to 99.5th percentiles largely include physicians, attorneys, upper middle management, and small business people who have done well. Everyone’s tax situation is, of course, a little different. On earned income in this group, we can figure somewhere around 25% to 30% of total pre-tax income will go to Federal, State, and Social Security taxes, leaving them with around $250k to $300k post tax. This group makes extensive use of 401-k’s, SEP-IRA’s, Defined Benefit Plans, and other retirement vehicles, which defer taxes until distribution during retirement. Typical would be yearly contributions in the $50k to $100k range, leaving our elite working group with yearly cash flows of $175k to $250k after taxes, or about $15k to $20k per month.

Until recently, most studies just broke out the top 1% as a group. Data on net worth distributions within the top 1% indicate that one enters the top 0.5% with about $1.8M, the top 0.25% with $3.1M, the top 0.10% with $5.5M and the top 0.01% with $24.4M. Wealth distribution is highly skewed towards the top 0.01%, increasing the overall average for this group. The net worth for those in the lower half of the top 1% is usually achieved after decades of education, hard work, saving and investing as a professional or small business person. While an after-tax income of $175k to $250k and net worth in the $1.2M to $1.8M range may seem like a lot of money to most Americans, it doesn’t really buy freedom from financial worry or access to the true corridors of power and money. That doesn’t become frequent until we reach the top 0.1%.

I’ve had many discussions in the last few years with clients with “only” $5M or under in assets, those in the 99th to 99.9th percentiles, as to whether they have enough money to retire or stay retired. That may sound strange to the 99% not in this group but generally accepted “safe” retirement distribution rates for a 30 year period are in the 3-5% range with 4% as the current industry standard. Assuming that the lower end of the top 1% has, say, $1.2M in investment assets, their retirement income will be about $50k per year plus maybe $30k-$40k from Social Security, so let’s say $90k per year pre-tax and $75-$80k post-tax if they wish to plan for 30 years of withdrawals. For those with $1.8M in retirement assets, that rises to around $120-150k pretax per year and around $100k after tax. If someone retires with $5M today, roughly the beginning rung for entry into the top 0.1%, they can reasonably expect an income of $240k pretax and around $190k post tax, including Social Security.

While income and lifestyle are all relative, an after-tax income between $6.6k and $8.3k per month today will hardly buy the fantasy lifestyles that Americans see on TV and would consider “rich”. In many areas in California or the East Coast, this positions one squarely in the hard working upper-middle class, and strict budgeting will be essential. An income of $190k post tax or $15.8k per month will certainly buy a nice lifestyle but is far from rich. And, for those folks who made enough to accumulate this much wealth during their working years, the reduction in income and lifestyle during retirement can be stressful. Plus, watching retirement accounts deplete over time isn’t fun, not to mention the ever-fluctuating value of these accounts and the desire of many to leave a substantial inheritance. Our poor lower half of the top 1% lives well but has some financial worries.

Since the majority of those in this group actually earned their money from professions and smaller businesses, they generally don’t participate in the benefits big money enjoys. Those in the 99th to 99.5th percentile lack access to power. For example, most physicians today are having their incomes reduced by HMO’s, PPO’s and cost controls from Medicare and insurance companies; the legal profession is suffering from excess capacity, declining demand and global outsourcing; successful small businesses struggle with increasing regulation and taxation. I speak daily with these relative winners in the economic hierarchy and many express frustration.

Unlike those in the lower half of the top 1%, those in the top half and, particularly, top 0.1%, can often borrow for almost nothing, keep profits and production overseas, hold personal assets in tax havens, ride out down markets and economies, and influence legislation in the U.S. They have access to the very best in accounting firms, tax and other attorneys, numerous consultants, private wealth managers, a network of other wealthy and powerful friends, lucrative business opportunities, and many other benefits. Most of those in the bottom half of the top 1% lack power and global flexibility and are essentially well-compensated workhorses for the top 0.5%, just like the bottom 99%. In my view, the American dream of striking it rich is merely a well-marketed fantasy that keeps the bottom 99.5% hoping for better and prevents social and political instability. The odds of getting into that top 0.5% are very slim and the door is kept firmly shut by those within it.

The Upper Half of the Top 1%

Membership in this elite group is likely to come from being involved in some aspect of the financial services or banking industry, real estate development involved with those industries, or government contracting. Some hard working and clever physicians and attorneys can acquire as much as $15M-$20M before retirement but they are rare. Those in the top 0.5% have incomes over $500k if working and a net worth over $1.8M if retired. The higher we go up into the top 0.5% the more likely it is that their wealth is in some way tied to the investment industry and borrowed money than from personally selling goods or services or labor as do most in the bottom 99.5%. They are much more likely to have built their net worth from stock options and capital gains in stocks and real estate and private business sales, not from income which is taxed at a much higher rate. These opportunities are largely unavailable to the bottom 99.5%.

Recently, I spoke with a younger client who retired from a major investment bank in her early thirties, net worth around $8M. We can estimate that she had to earn somewhere around twice that, or $14M-$16M, in order to keep $8M after taxes and live well along the way, an impressive accomplishment by such an early age. Since I knew she held a critical view of investment banking, I asked if her colleagues talked about or understood how much damage was created in the broader economy from their activities. Her answer was that no one talks about it in public but almost all understood and were unbelievably cynical, hoping to exit the system when they became rich enough.

Folks in the top 0.1% come from many backgrounds but it’s infrequent to meet one whose wealth wasn’t acquired through direct or indirect participation in the financial and banking industries. One of our clients, net worth in the $60M range, built a small company and was acquired with stock from a multi-national. Stock is often called a “paper” asset. Another client, CEO of a medium-cap tech company, retired with a net worth in the $70M range. The bulk of any CEO’s wealth comes from stock, not income, and incomes are also very high. Last year, the average S&P 500 CEO made $9M in all forms of compensation. One client runs a division of a major international investment bank, net worth in the $30M range and most of the profits from his division flow directly or indirectly from the public sector, the taxpayer. Another client with a net worth in the $10M range is the ex-wife of a managing director of a major investment bank, while another was able to amass $12M after taxes by her early thirties from stock options as a high level programmer in a successful IT company. The picture is clear; entry into the top 0.5% and, particularly, the top 0.1% is usually the result of some association with the financial industry and its creations. I find it questionable as to whether the majority in this group actually adds value or simply diverts value from the US economy and business into its pockets and the pockets of the uber-wealthy who hire them. They are, of course, doing nothing illegal.

I think it’s important to emphasize one of the dangers of wealth concentration: irresponsibility about the wider economic consequences of their actions by those at the top. Wall Street created the investment products that produced gross economic imbalances and the 2008 credit crisis. It wasn’t the hard-working 99.5%. Average people could only destroy themselves financially, not the economic system. There’s plenty of blame to go around, but the collapse was primarily due to the failure of complex mortgage derivatives, CDS credit swaps, cheap Fed money, lax regulation, compromised ratings agencies, government involvement in the mortgage market, the end of the Glass-Steagall Act in 1999, and insufficient bank capital. Only Wall Street could put the economy at risk and it had an excellent reason to do so: profit. It made huge profits in the build-up to the credit crisis and huge profits when it sold itself as “too big to fail” and received massive government and Federal Reserve bailouts. Most of the serious economic damage the U.S. is struggling with today was done by the top 0.1% and they benefited greatly from it.

Not surprisingly, Wall Street and the top of corporate America are doing extremely well as of June 2011. For example, in Q1 of 2011, America’s top corporations reported 31% profit growth and a 31% reduction in taxes, the latter due to profit outsourcing to low tax rate countries. Somewhere around 40% of the profits in the S&P 500 come from overseas and stay overseas, with about half of these 500 top corporations having their headquarters in tax havens. If the corporations don’t repatriate their profits, they pay no U.S. taxes. The year 2010 was a record year for compensation on Wall Street, while corporate CEO compensation rose by over 30%, most Americans struggled. In 2010 a dozen major companies, including GE, Verizon, Boeing, Wells Fargo, and Fed Ex paid US tax rates between -0.7% and -9.2%. Production, employment, profits, and taxes have all been outsourced. Major U.S. corporations are currently lobbying to have another “tax-repatriation” window like that in 2004 where they can bring back corporate profits at a 5.25% tax rate versus the usual 35% US corporate tax rate. Ordinary working citizens with the lowest incomes are taxed at 10%.

I could go on and on, but the bottom line is this: A highly complex and largely discrete set of laws and exemptions from laws has been put in place by those in the uppermost reaches of the U.S. financial system. It allows them to protect and increase their wealth and significantly affect the U.S. political and legislative processes. They have real power and real wealth. Ordinary citizens in the bottom 99.9% are largely not aware of these systems, do not understand how they work, are unlikely to participate in them, and have little likelihood of entering the top 0.5%, much less the top 0.1%. Moreover, those at the very top have no incentive whatsoever for revealing or changing the rules. I am not optimistic.


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  1. [...] Who Rules America? An Investment Manager Breaks Down the Economic Top 1%, Says 0.1% Controls Political and Legislative ProcessBy IntelWars – July 23, 2011Posted in: Conspiracy INTEL SOURCE LINK: ampedstatus.org [...]

  2. ric steinberger said:

    It’s hard to imagine any positive, progressive change occurring within the normal political system now, or in the near future. Without some violent events (e.g., major climate changes) and/or much bigger financial collapse, wealth will only further concentrate upwards. The sad irony: That tens of millions of Americans keep voting for politicians who are bought and paid for by that wealthiest 0.1%. There seems to be no cure for stupidity.

  3. David said:

    Sad to say, there does not seem to be much reason for optimism. FDR drove some significant reforms in the Depression, though necessarily because he was noble, but to stave off the total collapse of capitalism, under pressure from the masses. And he had Eleanor in his ear. Can we accomplish anything analogous today? Some say that enough people are not yet miserable enough to mobilize. Too many of us are comfortable in front of our large flat-screen TVs, soaking up propaganda and disinformation.

    And in the White House, as we watch the debt ceiling debacle, that faithful servant of the ruling rich presents himself as the pragmatic grownup dealing with children. But he is well to the right of the majority of American opinion, because he is “compromising” with those who represent the most openly rapacious sector of society: those who take there marching orders from the top %0.1.

  4. David said:

    Jeez, pardon my typos. I meant:

    FDR drove some significant reforms in the Depression, though _not_ necessarily because he was noble, but to stave off the total collapse of capitalism, under pressure from the masses. And he had Eleanor in his ear. Can we accomplish anything analogous today? Some say that _not_ enough people are yet miserable enough to mobilize…

  5. sneezy said:

    Nice to know there are still a
    few honest Joes dealing with upper
    echelon that are willing to somewhat spill their
    guts.

    Sure beats reading some cold mortar and brick
    financial statistics created in la la land.

  6. Richard said:

    “I am not optimistic”

    About what??

  7. Informed Realist said:

    Sorry to burst your bubble David – - – FDR was a banker, from a family of bankers going back to at least the later part of the 1700s in America. His trade was the kind of ‘political entrepreneurism’ versus actual productive free market capitalism mentioned in the article. He had a long history of such insider dealing & opportunism. Politicking was how he made money & attained more power. His programs after being elected president were filled with cronyism. You didnt get a job or a contract in government programs unless you supported FDR. And for many people, that was the only kind of jobs and work out there. – - – As for Eleanor – - – she was a socialist.
    The Glass-Steagal Act of 1933 was championed by Carter Glass who was a co-sponsor of the Federal Reserve Act of 1913. Though some of the provisions in that act might have been helpful in our recent economic situation, the legislation came about in response to the disaster that the bankers created themselves that brought on the first Great Depression. Notice how they come up with some new regulatory legislation after the facxt ? Its a means to divert attention from those that caused the situation. Often it further centralizes power in the top insiders hands, at the expense of their innocent small competitors.

    If you do deeper research, you’ll find that western banking interests financed Soviet socialism in the USSR and nationalist socialism (Nazism) in Germany. Why ? One of the reasons is that such centralized collectivists systems give maxium control and priviledge to the insider top 0.1%. Such economies & societies are completely controlled by political, rather than productive considerations. It sure isnt true free market capitalism. Also, such systems lessen the threat to the elites from upstarts below them who might find out that theyve been robbed and lied to, that ‘the comrade workers’ aren’t running things and sharing in all the new wonderful benefits afterall. – - The ‘threat’ of internal and external ‘enemies’, and ‘patriotism’ have also been used to divert the attention of the common citizenry from their condition – - – brought on from those above. War is (in their minds) a wonderful tool for this diversion – - and quite profitable.
    If you do research, you’ll see that certain German industrialists who were at the center of the Nazi war machine were able to recover their financial assets after the war with the assistance of western bankers, attorneys, and government officials.
    I’ve brought up a few major topics that cannot be adequately expanded here. I would encourage anyone to research into this more deeply for themselves. My point is that the influence and impact of certain particularly evil members at the highest level of that 0.1% can involve more than just making outrageous financial profits. It can also involve issues of war versus peace, and life or death for millions of the remaining 99.9% of the citizenry. (Of course, the 0.1% dont actually fight in these wars themselves, you go or your kids do.) – - – -

  8. ectoendomezo said:

    WOW…

    WHAT A BUNCH OF….BULLSHIT!

    SO…LET ME SEE..”WHO CONTROLS AMERICA?”

    OH…OKAY.SO THIS ARTICLE…ASSUMES THAT THE “RICH PAY MOST OF TH TAXES AND THUS ARE IN FACT FINANCING EVERYTHING FROM THE ‘WARS’ TO ‘TSA’ TO? TO? TO? TO? TO? TO?”

    REALLY?

    UMMMMMMMMMMM OHHHHH…”REALLY?”

    NOPE!

    YOU………CONTROL AMERICA.

    YOU JUST ARE TOO TERRIFIED AND COWARDLY AND IN SUCH DEEP IN FACT..PATHOLOGICAL..DENIAL..THAT YOU LITERALLY….”CANNOT”…ADMIT IT.

    LET ALONE…”ACT UPON THE REALITY THAT IT IS….YUOR….MONEY THAT IS BEING USED FOR EVERY SINGLE….EVERY….SINGLE…BULLET…PROGRAM…AGENDA…MINUTE OF ENHANCE INTERROGATION…GRAM OF GOLD…GALLON OF GAS…TANK…VEHICLE..BOOTS…OFFICE FURNITURE…AND OF COURSE….EVERY….SINGLE…’SALARY’.”

    YOU!

    YOU ARE THE COWARDS.

    YOU ARE THE ONES LYING TO YOURSELVES AND EACH OTHER.

    THIS IS A FAKE “IDEA”.

    IT IS PERHAPS THE GREATEST PIECE OF REVISINIST PROPAGANDA EVER CONCEIVED.

    BECAUSE LIKE ALL THE GREATEST PROPAGANDA AND LIES…TOLD TO A TIMID AND OBEDIENT PEOPLE (I WILL NOT CALL YOU ‘CITIZENS’ BECAUSE YOU AREN’T)..THERE IS A “KIND OF TRUTH” TO IT.

    SURE…ABSOLUTELY…THE WEALTHY..BECAUSE…UMM..THEY HAVE MONEY AND UMM..UNLIKE YOU…ARE WILLING TO..AND UNDERSTAND IT HAS..GOLLY GEE..”POWER”…AND THEY USE THAT POWER AND LEVERAGE TO……….EXERCISE AS MUCH INFLUENCE AS THEY CAN.

    THE LIE IN THIS PROPAGANDA IS SO..OBVIOUS..SO MASSIVE..IT IS ALMOST….FUNNY.

    SO..THE “0.01%” ARE CONTROLLING THE NATION?

    OH..AND THAT LEAVES YOU…THE 99.99% UMMM…WELL..WAIT…DOING WHAT?

    AVOIDING ALL PERSONAL RESPONSIBILITY TO WILED THE….99.99% OF THE REST OF THE MONEY..AS POWER.

    WOW!

    YOU PEOPLE REALLY ARE SO STUPID YOU FRANKLY…ARE GETTING EXACTLY THE KIND OF GOVERNMENT YOU….DESERVE.

    I MEAN IF YOU CANNOT EVEN….SEE..THAT YOU..AS 99% OF THE POPULATION…ALSO POSSESS 99% OF THE TAX MONETY NOW BEING SPENT TO IN FACT ALLOW THE CORPORATE FASCISTS TO DO AS THEY PLEASE…THEN YOU…ARE…SIMPLY NOT GOING TO MAKE IT. PERIOD!

    BECAUSE IN REALITY?

    THERE IS NO “FINANCIAL VACUUM”.

    THIS IS HAPPENING BECAUSE YOU……….REFUSE…TO STOP PAYING!

    YOU….WANT….TO PAY!

    SO…YOU KEEP PAYING FOR THE LETHALLY DEFECTIVE “PRODUCT” BEING PRODUCED BY THIS VICIOUS CORPORATE FASCIST GOVERNMENT..AND THEN CRY ABOUT IT?

    WOW!

    THAT’LL WORK!

    SURE WILL!

    NOPE!

    I FIND IT..TRULY….STUPEFYING…WHEN I READ YET ANOTHER ARTICLE IN ‘THE NATION’ OR? OR? OR? ABOUT “CITIZENS UNITED”..AND THE “POWER OF MONEY”…AND THEN…I WAIT…AND…………NOTHING.

    INSTEAD OF THE..OBVIOUS..TO ANYONE NOT CONSUMED WITH DENIAL OF THEIR TOTAL COMPLICITY….THE OBVIOUS “NEXT STEP” IS:

    “OH…WAIT…WHAT IF…WE..THE PEOPLE…JOINED TOGETHER AND BECAME A REAL….’CITIZEN UNITED’…AS IN…’CITIZENS UNITED IN TAX PROTEST AND BOYCOTT’?…GOSH…WHAT WOULD HAPPEN THEN?”

    WELL? SEE..WE KNOW..WHAT HAPPENS BECAUSE IT IS SO PERFECT A ‘TACTIC” AND IT HAS RENDERED THE SAME RESULTS SO DEFINITIVELY AND CONSISTENTLY THAT THIS “TACTIC” OF TAX REVOLT/BOYCOTT IS AKIN TO A SCIENTIFIC LAW.

    BECAUSE AFTER EVERYONE FROM MANDELA AND SOUTH AFRICA….

    TO THE FARM WORKERS AND GRAPE BOYCOTTS…

    TO GANDHI AND THE BRITISH EMPIRE…

    TO THE FOUNDING FATHER AND THE BRITISH EMPIRE….

    WELL..IT AIN’T “HYPOTHETICAL”..AND IT AIN’T “THEORETICAL”…

    NOPE!

    ITS A VERITABLE…………”LAW”.

    THE RESULTS ARE THE SAME……EVERY TIME.

    TAX REVOLT/STRIKE AND BOYCOTTS…END…EVERY TIME..WITH THE CITIZENS EXPERIENCING VICTORY OVER…..VICTORY…OVER….WHICHEVER ENTRENCHED CORPORATE FASCIST REGIME WAS……WAS….DESTROYING THEIR LIBERTY.

    IN FACT….IN AMERICA…THE FOUNDERS BUILT THIS FAIL-SAFE INTO OUR ‘SYSTEM”.

    BECAUSE THIS “GOVERNMENT”….LITERALLY…AGAIN NOT FIGURATIVELY……BUT…..LITERALLY…..”CANNOT FUNCTION”….OR CONTINUE AS IT “WISHES TO”…WITHOUT….SANS…. THE COMPLETE…………………………………… ………………………………………… …..”FINANCIAL AGREEMENT/COMPLICITY OF THE GOVERNED”.

    AKA….”YOU”!

    YOU….ARE AGREEING…TO THEIR EVERY DEMAND AND WISH WHEN YOU……………PAY THEIR SALARIES.

    YOUR PAYMENT..IS LITERALLY…A “CONTRACT”…AND YOU ARE EXPRESSING “APPROVAL” AND THEN YOU GET A LITERAL “RECEIPT” AND AWAY THEY GO TO SPEND YOUR MONEY ON ALL THOSE THINGS YOU…CLAIM..TO “NOT WANT”.

    AND THE “RICH” THAT THIS ARTICLE PRETENDS ARE IN “CONTROL”?

    GUESS WHAT?

    THEY…ALREADY….DON’T PAY.

    NOPE!

    THE ABSOLUTE MASSIVE MAJORITY OF ALL PUBLIC FUNDING..COMES FROM………………..YOU!

    IF YOU STOP PAYING?

    THIS TRANSITION FROM DEMOCRATIC REPUBLIC TO CORPORATE FASCISM………STOPS!

    PERIOD.

    BUT YOU ARE COWARDS.

    AND LAZY TO THE POINT OF SUICIDAL.

    TO COWARDLY AND LAZY AND IRRESPONSIBLE TO….SIMPLY:

    “STOP PAYING”.

    USE THE POWER OF MONEY…AS THEY DO…OR BE QUIET.

    YOUR LACK OF REALITY AND ABILITY OR DESIRE TO ACCEPT THAT IT IS YOU….WHO ARE FINANCING ALL OF THIS..IS AKIN TO SILENCE ANYWAY.

    SO..THERE IS NO 3RD WAY.

    ACCEPT RESPONSIBILITY FOR THE MONEY…YOU….ARE PROVIDING THEM WITH….OR SHUT THE HELL UP.

    I MEAN HEY…I READ THE ABOVE ‘COMMENTS” AND AM SIMPLY…STUNNED…SO MANY “AGREEING”…

    “OH YEAH…THE RICH USING MONEY TO CONTROL EVERYTHING….GALL…WHINE..WHIMPER…SIGH…”

    SPFAWWWWW!

    IF YOU AGREE…THAT MONEY IS POWER….UMMMM…THEN GOLLY GOSH GOLLY GEE WHIZ…..

    WHY…………… NOT……………… ENGAGE……………. IN……………..
    THE……………….. SAME………………….. PRACTICE?

    OOP!

    UH-OH!

    REALITY…WHAT A BUMMER DUDE!

    YOU LIARS!

    YOU MAKE ME SICK!

    YOU’RE COMPLAINTS ARE COUNTERFEIT!

    FAKE.

    AS FAKE AS THE CLICKTIVISM AND YOUR FACEBOOK “FRIENDS”.

    FAKE!

    UNTIL YOU ACCEPT YOUR ROLL AS THE REAL FINANCIAL BACKERS OF THE DESTRUCTION OF YOUR OWN FREEDOM…AND ACCEPT THAT YOU COULD…CHANGE THIS IN LITERALLY..”WEEKS”…CERTAINLY MONTHS….BY REFUSING TO PAY “EN MASSE”….UNTIL THAT POINT…YOU WILL REMAIN INEFFECTUAL FAKES.

    USE THE POWER OF MONEY. APPARENTLY YOU BELIEVE IN ITS POWER….SO UMMM….GOSH…I WONDER WHY IT IS…THAT YOU…ARE NOT…USING IT YOURSELVES?

    I GUESS THEY REALLY ARE…SMARTER THAN YOU.

    PERHAPS THEY DESERVE THE POWER THEY ALLEGEDLY HAVE.

    AFTER ALL…THEY SEEM TO BE WILING TO DO WHAT YOU ARE NOT..TO OBTAIN IT.

    USING THE LEVERAGE AND POWER OF MONEY.

    AND THEY ARE…1%

    YOU ARE 99%

    UH-OH….REALITY AGAIN.

    DARN IT.

    WAKE UP…IT IS AN OLD AXIOM AND TRUE…TRUE….TRUE….TRUE:

    “MONEY TALKS! BULLSHIT WALKS!”

    “LET THEM MARCH ALL THEY WANT, AS LONG AS THEY CONTINUE PAYING THEIR TAXES” — ALEXANDER HAIG

  9. KEN WEINBERG said:

    A GOOD WAY TO START IN BRINGING THESE PEOPLE OUT OF THE SHADOWS WOULD BE TO HAVE THEIR NAMES, PICTURES, NET WORTH AND HOW THEY ACQUIRED IT, PLASTERED ALL OVER THE MEDIA BUT THAT WILL NEVER HAPPEN BECAUSE THEY HAVE THE MEDIA IN THEIR POCKETS, JUST LIKE THEY DO THE CONGRESS.

    THEIR GREATEST COUP WAS GETTING THE MANCHURIAN CANDIDATE OBAMA IN THE OVAL OFFICE, WITH GEITHNER AND BERNANKE TO KEEP AN EYE ON HIM SO HE DOESN’T GET ANY RADICAL IDEAS. I THINK THE ONLY WAY OUT OF THIS MESS IS TO TAKE A OPAGE OUT OF THE HISTORY BOOKS —- THAT IS FRANCE, 1789 TO 1794. I THINK A SCAFFOLD AT WALL AND BROAD STREETS MIGHT JUST BE ENOUGH TO MAKE THEM THINK TWICE.

  10. [...] Manager Breaks Down the Economic Top 1%, Says 0.1% Controls Political and Legislative Process (Amped Status) • Return of Mass Layoffs a Grim Sign for U.S. Workers (Yahoo Finance) • Smash The Debt Ceiling [...]

  11. Informed Realist said:

    ectoendomezo makes a good point IMO. The French philosopher Etienne de la Boetie back in the 1500s asked – Why is it that millions of men allow themselves to be oppressed by the few – — even by one small man ,when physically this is not possible ? – His book The Politics of Obedience examines this question. – - The answer, of course, is that the many Allow themselves to be dominated by the few, and actually participate in their own oppression. de la Boetie’s solution is one that doesn’t require any violence at all – - – to just stop going along with the program:

    “Resolve to serve no more, and you are at once freed. I do not ask that you place hands upon the tyrant to topple him over, but simply that you support him no longer; then you will behold him, like a great Colossus whose pedestal has been pulled away, fall of his own weight and break into pieces.”

    I don’t think the article was b.s. however. It is useful because it points out a reality that most people are completely unaware of, – - – that they are dominated by a small group using various tools to do this including control of the mainstream media , fiat money system, and political system. They spin illusions, but once enough people you see through them & decide to no longer go along with their own enslavement – - – they will recognize that Feedom was only within their power to choose . . . or deny.

    The power of the internet and websites like this one . . . is that people have a way to see beneath the illusion of their own ‘powerlessness’ and ‘helplessness’. If people recognize their own ultimate power – - – its all over for the slavemasters.

    http://mises.org/daily/4138

  12. Jeff said:

    I don’t know whoruns America, but I definitely run BarterTown.

  13. [...] Who rules America? A high-wealth money manager has the answer. (Amped Status) [...]

  14. Bob White said:

    I am a member of the bottom half of 1% and I live in a small house on a 60×100 lot I bought for under 280K, drive a used car, do my own home repairs, have no nanny, no babysitter, no fancy vacations, I live more modest than any of my five figure blue collar neighbors.

    Why cause in Corporate America you often don’t get that SVP level job till 45 and by 55 you are pushed out the door. I am in my prime earning years.

    With multiple college and weddings to pay for, a stay at home wife and paying for retirement for two plus no pension and free medical for me as I am not in a union I can’t afford to spend more than 50% tops of my salary without risking eating dogfood when I am 80.

    You need over one million a year salary or more than five million in assets to do proper tax startegies. Or have a highly paid union job with a definded benefit plan and free medical for life. The inbetween is a hard place.

  15. Informed Realist said:

    Bob White – - – thats one aspect of the article that I found off the mark. It put the bottom half of the top 1%, – often made up of small businesspeople and owners of small corporations, in the same category as those who own/control the levers of economic & political power in the current system. The bottom of the top 1%, and those below them in the upper middle class – -will likely be demonized, taxed, and regulated as ‘the wealthy’ in the near future. Over time, there are likely to be even fewer numbers of them in America. That will be a shame, as this was the route by which it was possible for someone with modest means & hard work to advance themselves in this country. Small business also creates most the the jobs. This fosters a banana republic kind of society with a few priviledged at the very top, and everyone else in poverty & dependent on the central government. (The USSR was the perfect example of this. As I wrote earlier, Soviet socialism was financed by western big banking interests in the beginning. The monopoly men crave systems of rule that expand and protect their power – - no matter what outward form or intelluctual propaganda is used to sell it.) — The billionaires at the top of this current system can use various vehicles including trusts, private foundations, and offshore entities to protect their wealth/power & live off of and dominate the rest of the populace who are made to pay, . . and play by different rules.

    I find it interesting when talking with successful hardworking millionaires with their own businesses who don’t quite see the writing on the wall (if we continue down this path). They defend aspects of the current system as ‘capitalism’, but don’t see that this is not true free market capitalism at all. The rules that they have to run under, are quite different than those for those on the very top – - who pay off legislators to write the ‘rules’ as they direct. (Is it any wonder that often Congress votes for new bills that they don’t understand, or have even read ? They do as theyre told.)
    None of this is obvious when the economy seems to be running well and most are enjoying the apparent abundance. Its only when things get rocky, that we begin to question some of our prior assumptions & beliefs. Such questioning can lead a society to the path for Freedom (extremely rare) or dictatorship (common in history).

  16. zaknick said:

    Can’t wait for the FRN collapse and all of these scumbags end up broke or their ill-gotten wealth and power severely curtailed.

    Death to the banksters’ toilet paper manipulation.

  17. Random Paleocon said:

    Brilliant article. However, the author ignores the cultural fissures which permit the top 0.1% of society to view the other 99.9% as mere prey. There was a time, not too long ago, when elites viewed themselves as part of one people with the populace. No more. The people making the consequential decisions in America these days have neither loyalty to their countrymen nor patriotism for their homeland. That they would band together to propose measures calculated to strengthen our economy is as foreign to their Weltanschauung as industrial capitalism is to the Hottentots.

  18. Bill said:

    The net worth figures in this article seem significantly off. Far more than 1% of households are worth $1.2M or more. Maybe they’re talking about investable assets or something ie net worth minus all real estate equity, minus the value of all businesses, minus the present value of a pension, minus 401ks and IRAs, etc. Also, the MEDIAN family net worth is something around $120K. The average is much higher. The census publishes a lot of this data so it is out there but the last time I viewed it something like 10% of American households were worth $1M. I mean how does someone pulling in $300K/yr for a decade or more only have $1.2M in assets?

  19. Informed Realist said:

    Random Paleocon – - you bring up an interesting point. I’ve only begun to explore the issue of top ‘elite’ loyalties. But many of these people have roots that they can trace back for several centuries, and its feasible to me that their first loyalty is to their own family over any nation. In some instances their ancestors created ‘nations’ in such a way as to benefit themselves and their families. Study the history of Europe and you’ll see that the various royal families from various countries were all related to one another. The German roots of ‘British royalty’ are well known: http://www.independent.co.uk/news/uk/home-news/how-the-royal-family-shook-off-their-german-roots-532208.html

    In any case, the desire for a few to live off the majority of the people, is as old as humanity. Nothing is more lucrative than farming . . . people. It continues in many various forms because most people are blind to their own power and worthiness. The American experiment begun over 200 years ago, was an attempt for the common man to break out of his self imposed chains.

  20. slcraig said:

    Written like a clever fellow traveler who views the economy as a zero sum game.

    Fails to acknowledge that the 1% and the .05% EXPANDS along with the economy and population.

    That 1% is 3 million persons, (or if only counting ‘workers 1.5 m or more)….show me a nation in the world, free or otherwise that can boost of such upward mobility from generation to generation.

    To be in the middle ranks of the US economy is as if being Kings and Princes in this world of 6 billion………

    The American economy, when allowed to function as the Constitution intended, is NOT a zero sum game and will, as it has, lift the living standards of not only its own future generations, but of the rest of the world, as it navigates the passing of time.

  21. Informed Realist said:

    Real incomes in the US have actually been falling for several decades.

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  24. thedarkdaysofsummer said:

    when its all broken down to its smallest point…the only place to find true freedom is in your own heart, soul and mind. Ultimately ectoendomezo is right. But in the end, what shall it profit a man, if he shall gain the whole world, and lose his own soul? Inward affects outward, unseen rules seen, we battle not against flesh and blood but against pricnipalities, against powers, against the rulers of the darkness of this world, against spiritual wickedness in high places. Our real power lies in this revelation.

  25. Don Keller said:

    I’ve learned a lot from this reading, but having been a part of this nefarious industry, I’m not too surprised about what I read. What is surprising is how so many voters, especially the majority of Republicans who are nowhere near the super rich, continue to vote against their own interests.

  26. Andrew Gold said:

    The disproportionate economic and political power of the “1%” is the subject of an excellent essay by Nobel Prize winning Economist, Joseph Stiglitz: http://www.vanityfair.com/society/features/2011/05/top-one-percent-201105.

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  28. Svigor said:

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    Just sayin, if we’re going to start talking about European noble families and such…

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