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Comment Re: Poor people are poor because they're lazy (Score 1) 459

Read his wikipedia page: "He grew up in a two-bedroom apartment in Chicago's South Shore middle-class Jewish neighborhood." Is that a sign of a wealthy family?

His adoptive father was "was a pompous government employee who had made a small fortune in Chicago real estate, only to lose it during the Great Depression." So, no, not wealthy.

Definitely have to grant you that one. Reading comprehension fail on that one. Missed the fact that he'd lost the fortune. I do have to say that a two bedroom apartment doesn't mean poverty. There are plenty of luxury apartments with two or fewer bedrooms.

I didn't say his parents were not middle class. I actually said that list is all middle class, simply not upper-middle class with powerful connections. He had Russian Jewish immigrant grandparents on both sides of his family. Are you agreeing this isn't an upper-class background, which was the argument I refuted in the first place?

Problem is, the details never really say how well off most of these people really were or were not. Were they just middle class, or upper middle class. Probably the latter. As I said, I'm not really sure why I'm in this particular argument rather than the comments about Walton's super-rich heirs. Here I was just examining the details I could find about your list of outliers. Most of them don't seem to have come from actual poverty, which was what the original article was discussing but I certainly admit that there are some who did come from outright poverty and others who came from less than upper middle class or wealthy backgrounds.

Also I'd like to note that a Russian Jewish immigrant background says nothing about relative state of poverty or wealth.

Jeff Bezos is the only one I listed that you have a chance of claiming comes from a rich background with good connections. Yes, his mother's family owns a ranch, but I don't find anything on how much money they made, and it is really easy for farmers and ranchers to lose everything. His mother's father was a regional director of the U.S. Atomic Energy Commission, which probably helped open a few doors as well. As I say, this is the closest of the ones I listed to being upper-middle class with connections.

I listed Jeff specifically because I think it is great that a Cuban immigrant can come to America, alone at age 15, and marry a young ranch girl with a young son, and now be the father of the 11th wealthiest person in the US.

Not much to say on that one, really. Just quoting it for completeness. This space for rent.

Wow, you got me. A knitting shop.

Eh, I just addressed them all out of a compulsive sense of completeness. You should note that I also wrote: "Not that it made them rich..." For all we know, it was a massive success of a knitting shop, but it's probable it was just a small shop earning a small profit.

I listed the father because I didn't feel like adding that his mother ran a knitting shop. Check out the list I posted in response to mvdwege, where I had that detail as I made the list, with all the others whose mother's occupation was listed. But for the short list, I went with the fact Sheldon's father drove a taxi cab to illustrate that the family was not upper-middle class with powerful connections.

Well, yes, but the mother is the one who appears to have had her own business. That may not actually be the case. It's hard to tell from the brief descriptions. She may have just been the manager of someone else's shop, and the father may have been an owner operator. It seems to be saying though that she owned her own business and he worked for a wage and tips. Even if that is the case, it doesn't mean her business was a success and that he didn't make more money driving the cab. I just found it interesting that you focused on the fathers and ignored the mothers. You did that with the Walton heirs and with Bezos, so it stuck out.

What part of "born in the USSR" doesn't scream "not upper-middle class with powerful connections"?

I'm not really sure I follow you. Plenty of rich people have been born in the USSR. That said I'm not saying that Brin's family was upper middle class, but they do appear to be professionals in good fields with bonuses for their kids. Partial or full tuition remission at university, for example.

Also, Once again, you are implying I said they are not middle class. Why?

Fair enough. We do seem to be arguing a bit at cross purposes. I'm focusing more on the poverty angle of the original article and sort of ignoring the tangent discussion you were originally involved in. As I said, mostly just got involved here because of your odd claims about the Waltons.

Have you heard of the Nazis before? Have you heard of the Holocaust? Do you have any idea what happened to many "reasonably well to do" Jews during that time? Of course you do. I don't care for Soros' actions or what I have read of his outlook ( I have read one of his books, but it was disappointing Bush-bashing rather than informative of his ideas). But I am not going to deny that he went through hell, and was lucky to survive.

Maybe his family were upper-middle class Jews who survived the Nazis because of important connections, but I'll keep him on this list just the same.

Fair enough. Related to the original article about poverty, I should note that I do see an interesting pattern here of many of these people experiencing significant displacement and possibly even oppression. Not sure if it's significant or not, but I wonder if there are factors of drive and broader perspective that come into play.

So, now I have to show the outliers are outliers among outliers. So, if the norm for the 400 people on the list is actually middle to low backgrounds with no important connections, than I haven't shown anything, because I am not showing outliers among outliers??

Well, I'm still keeping the original discussion in mind when I write things like that. A list of 400 is, obviously only a tiny, tiny fraction of the population and doesn't really speak much to the far, far larger number of poor people out there. Being the 400 richest, these people are on the far end of the bell curve and most of them have attained extraordinary wealth beyond where they started in life. Basically, if you're looking for the recipe that makes most rich people rich, you're probably going to have no more luck than looking at the 400 poorest people to find out what makes poor people poor.

Check out my response above to mvdwege.

Well, the first person on that list is Buffet, whose connected US Representative father was also the Buffet in Buffett-Falk & Co, which was Warren Buffet's first finance job. That's not very convincing. Then you list the Koch brothers who inherited their oil business from their father. Then you list the Walton heirs again. We don't know about how successful the parents of Bloomberg are, so you default to assuming they're middle class rather than upper middle class or wealthy. Then you assume the same for Ballmer, despite living in an upscale neighbourhood and going to an expensive private prep school. Then you ignore the fact that an associate library director for the libraries of a big university is a pretty big position and that Paul Allen was also going to an expensive private school. Then there's Michael Dell with a stockbroker and orthodontist, two occupations that typically aren't just middle of the road middle class, as parents. Then there's Phillip Knight, whose father was a newspaper publisher and ran several radio stations and was also a member of the Oregon House of Representatives. Then there's Job's widow who married a rich man and seems to have come from at least a slightly privileged background herself. You also list James Simons, whose father owned a shoe factory.

Ok. I'm tired. You did mention "working upper middle class" on that. Honestly I don't know where we stand on this. I don't even really know what we're disagreeing on here any more.

Seems like that would say quite a lot about 'the poverty trap'.

No more than the fact that rocks from Mars have ended up on Earth says about the difficulty of escaping a planet's gravity well.

And I can't understand why you think the heirs of a man who rose from either bottom-middle class or actual poverty, to be the richest man in the country in some way disproves that that rise is still possible for others.

I've never made any such ridiculous argument. The point I'm making is that, for the vast majority, such a rise is next to impossible, regardless of how they apply themselves. Most people who get there had special advantages, but most people with special advantages still don't get there.

My argument isn't that his heirs didn't come from a rich family, although I don't see evidence that they were wealthy when the kids were still kids.

Well, the oldest was born in 44. By the time he reached first grade, his father had two stores and aggressively expanded in the following years. His mother also clearly came from a family with a decent amount of money. So, even the eldest should have grown up knowing that his father was a successful businessman. The younger ones certainly should have. Also, the children of Sam and Bud Walton have their own heirs now.

My problem with excluding them is that the whole point of working hard to build up family wealth is to be able to pass it to your children, and for them to properly manage their part to pass to their own children. Negating the Walton clan's place in that system, just because their father was wealthy when he died, is an unreasoned attack on the basic human desire to provide for your family's well being. Especially since so many of the people I have looked at so far came from immigrant families, or were themselves immigrants, and moved to the US specifically to give their family a better life

Building up "family wealth" may be a bit different than just building up wealth. I would say that there are a lot more reasons to build up wealth than just to leave it to family. The former does seem to be tautologically true, however. In any case, I certainly did not argue that people don't typically leave their wealth to their children if they can. That doesn't have anything to do with the fact that Walton's heirs are his heirs and not Sam (or Bud) Walton themselves. Sam and Bud Walton aren't on the Forbes 400 because they're dead. Their heirs are on the list, but they inherited their money.

Thank you. With that, I will go back up and delete some words before posting this. (Nothing foul, just not friendly.)

These things always seem to end up with lengthy arguments that really hinge on on some fairly shallow semantic differences magnified by mutual misunderstanding of exactly what you're disagreeing with. After taking a wander to the top of the thread to remind myself, I wonder why I bothered to type so much. The original poster said that no-one came from poverty, you pointed out some who did. Probably should have been case closed at that point, but then we had to argue about the middle cases. I simultaneously feel pretty strongly about my position and fairly fuzzy on the exact point where our positions disagree. Plus I'm tired. I think I'll go to sleep.

Comment Re: Poor people are poor because they're lazy (Score 1) 459

3 Larry Ellison, born to an unwed mother, adopted by family members

Adopted by family members yes. Wealthy ones.

10 Michael Bloomberg, gather was a real estate agent, grandparents were Russian Jewish immigrants (not a group known for being wealthy)

His parents were middle class at least during his formative years, certainly not poor. It's a little unclear what his father did, some sources say bookkeeper and some say real estate. Varied business interests? In any case

11 Jeff Bezos, while his mother came from a ranching family, his adoptive father was a Cuban immigrant

So, his mother's family were rich and she married someone who might not have been rich. I'm not sure how that makes him not from a wealthy background.

12 Sheldon Adelson, father drove a taxi cab

Mother ran a knitting shop. Not that it made them rich, just wondering why you only count the fathers.

13 Sergey Brin, born in the USSR, came to USA with parents at age 6

Father a math professor and mother a researcher for NASA. Once again, not rich, but definitely middle class.

15 George Soros, while his parents were not poor, they were Jews in Hungary when the Nazis invaded

Mother from a reasonably well to do family and lawyer father. Not necessarily rich, but far from poor. So middle class background and family connections.

How many more do I have to list before they are no longer the outliers?

Well, it's a list of 400 (and the whole list are outliers just from being the richest of the rich in the first place), so I would say you have to list quite a few more.

In any case, I don't have a lot invested in this argument. Arguing about the mega-rich doesn't really say anything about the poverty trap, even if every person on the list actually came from abject poverty. For some reason, some people always want to focus on the mega-rich. It reminds me of arguments about, for example, mixed-gender youth sports teams, where there's a certain type of personality which will always focus on professional sports teams. It doesn't make any sense, as they are statistical anomalies anyway.

The thing that gets me is that you're still apparently convinced that Sam Walton's heirs and their heirs are somehow proof that people on the Forbes 400 list aren't descendants of wealthy people. I have to admit that you have solidly disproved the absolute statement made that "all of them come from at least upper middle class".

Comment Re:90% of millionaires (Score 1) 459

90% of millionaires earned less than $100K from their jobs. They got a million dollars by saving slowly over time and letting investment do it's thing (growth).

The ceiling on what someone earning federal minimum wage can earn in a year is about $87,500. That would be working 24 hours a day every day without any sleep and it accounts for overtime. Clearly no human could actually manage that, and no single minimum wage job would give anyone that many hours. Instead what happens is that minimum wage earners work multiple part-time jobs, which means they can theoretically work 80 or more hours a week without earning any overtime, which would be more like $30,000 a year (plus bonus medical expenses from high blood pressure, etc.) They're simply well below the level where they can get anywhere from wise investing. I think we both agree that the best investment for anyone earning that is in getting better employment.

As for those millionaires, I think you're not recognizing here that a millionaire isn't exactly a big deal any more. A millionaire is what any upper middle class person should be on retirement unless something went wrong.

Comment Re: Poor people are poor because they're lazy (Score 1) 459

It's not that clear that Sam Walton's family was all that poor. Aside from being a farmer, his father ran some sort of mortgage business. How much of a success he was is unclear. His heirs, however, are also the heirs of his wife, who was from a quite well off family. Not as massively wealthy as the Waltons would become, but well off enough to provide most of the money for Walton to buy his first stores. Walton's heirs also have heirs of their own, so we're talking about at least 4 generations. How many do you require for "long established wealth"? I get the feeling that your definition involves ancestors lugging sacks of gold off the Mayflower, or possibily a lineage that goes back to Charlemagne or something like that. I certainly don't claim that myself. It is generally true that most wealthy people come from wealth in one way or another. It's certainly not universally true, but it's true enough. The Walton family are not an example of currently rich people who come from poor backgrounds. I see it as being as simple as that.

Whatever background Walton came from, he had a family safety net and connections. He wasn't in the situation this article is talking about where stress or desperation trap people in poverty. Quite aside from that, he's also an outlier. Even if he had made a fortune out of absolute poverty, outliers don't invalidate this theory. Just because the poverty trap isn't perfect doesn't mean it isn't real.

Comment Re:has never lost = not gambling (Score 1) 459

I guess you missed the part "over any 20 year period"

Didn't miss it. I don't necessarily agree with the future predictive power of those stats. Maybe I read too much Jane Austen when I was younger. All those people talking about their set yearly investment incomes. Apparently a lot of that was based on Navy bonds. Made me wonder what happened to all those people after the bottom dropped out of Navy bonds... Actually, not really, they were all connected upper class and got a bailout.

The same can be said of any 10 year period, except the period 2000 - 2010 and if you pick specific dates at the great depression.

So, except for half of the last 20 years. I certainly admit that just about everything is a gamble, so why not gamble on the stock market. It very well may work. Ultimately, nothing beats having real earning potential. The simple fact of the matter is that the minimum wage earner who squirrels away a little bit of money into an investment account every day would be much better served by searching for a job that pays twice as much. It's frankly a lot more realistic than gradually earning interest on a pittance invested in the stock market.

Comment Re: Poor people are poor because they're lazy (Score 1) 459

I'm not quite sure why you're giving him Sam Walton who isn't on that list since he's dead. The fact that the GP thinks pointing to Sam Walton's extremely wealthy heirs as an example proving that the people on the list aren't a bunch of wealthy heirs seems to point to a pretty bizarre case of cognitive dissonance.

Comment Re:FTFY (Score 1) 459

.Donald Trump was born rich too, but others like Warran Buffet, Bill Gates, and Jobs earned their money.

They certainly earned lots of money above what they started with, but the first brokerage Warren Buffett worked in was Buffett-Falk and Company, with the Buffett in the name being his US Representative father, and Bill Gates was a millionaire from birth. One out of three isn't bad I suppose.

Comment Re:5 years and compound interest = college (Score 1) 459

Why do people keep on talking about 3% compound interest as if it's gaining you money. Inflation is typically close to 3% over the long term. You have to subtract the rate of inflation from the interest percentage you're getting to get a real idea of how much you'll be getting from compound interest. You might actually end up losing money.

Comment Re:5 years and compound interest = college (Score 3, Insightful) 459

My baby will be born soon. If I drop the soda money into a Roth for five years, that's one year of tuition. I then stop saving. In seven years, the investment doubles. In another seven, it doubles again

So you'll be getting greater than 10% interest consistently over the course of decades. If you want to be realistic about inflation, you'd actually have to be doing better than about 13% interest. Then there's the fact that college costs are rising faster than inflation... Just doesn't sound realistic.

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