Bitcoin…North of Richmond
Financial Alienation, Cryptocurrencies and The Great Wealth Transfer
Could cryptocurrencies help trigger a massive wealth transfer to Generation Z? Consider the iron law of capitalism whereby, at least in relative terms, the rich get richer and the poor get poorer. The chart below fudges together different data sets to make the point that the median American family income has been eclipsed ten-fold by soaring World wealth levels over the past half century, even when measured in US dollars. [Without a recently strong US dollar, the gap would be far wider.]
Since the older generations own most of today’s wealth, it means that as fast as the baby boomers gain, Generation Z loses out. The old get richer and the young get poorer. Some label this financial nihilism. The Fed’s monetary policy responses to the 2008/09 GFC and to COVID have further exaggerated these wealth inequalities. In practice, history shows they are untenable and unlikely to persist. Something has to give. Huge wealth inequalities typically end in wars, revolutions and/ or inflations.