The Rich

There are questions as to why the rich got richer in the past ten plus years and they were helped by government policies. The money supply stayed around $3 trillion for most of my life but in 2020 it rose rapidly peaking at $21 trillion in 2022. Interest rates were almost zero from 2008 until 2022 when they started to rise to the present 5%. During the years of low rates many investment types used this cheap money to make money but the average Joe just watched his savings earn nothing and so the rich got richer. Stock markets tend to rise when there is easy money, as yields for depositors and other savers fall, they may seek yield elsewhere in the markets. Easy money also helps boost most firms' profits and allows them to borrow and invest more cheaply. Billionaires generally derive most of their income from asset appreciation, rather than salaries or bonuses. Unlike ordinary income, asset appreciation is not taxed until a gain is realized through the sale of the asset. To avoid or delay the hefty tax obligation resulting from the capital gains incurred, they borrow against their wealth and use the proceeds to not just pay for their expenses but also to reinvest in new ventures. In this way they keep their tax bills low, continue to benefit from the appreciation of their invested assets, plus increase their overall net worth with the additional investments made with the loan proceeds.