The High-Beta Rich: How the Manic Wealthy Will Take Us to the Next Boom, Bubble, and Bust

The High-Beta Rich: How the Manic Wealthy Will Take Us to the Next Boom, Bubble, and Bust

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by Robert Frank
     
 

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The rich are not only getting richer, they are becoming more dangerous. Starting in the early 1980s the top one percent (1%) broke away from the rest of us to become the most unstable force in the economy. An elite that had once been the flat line on the American income charts - models of financial propriety - suddenly set off on a wild ride of economic

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Overview

The rich are not only getting richer, they are becoming more dangerous. Starting in the early 1980s the top one percent (1%) broke away from the rest of us to become the most unstable force in the economy. An elite that had once been the flat line on the American income charts - models of financial propriety - suddenly set off on a wild ride of economic binges.      
      
Not only do they control more than a third of the country’s wealth, their increasing vulnerability to the booms and busts of the stock market wreak havoc on our consumer economy, financial markets, communities, employment opportunities, and government finances. 
     
Robert Frank’s insightful analysis provides the disturbing big picture of high-beta wealth. His vivid storytelling brings you inside the mortgaged mansions, blown-up balance sheets, repossessed Bentleys and Gulfstreams, and wrecked lives and relationships:

• How one couple frittered away a fortune trying to build America’s biggest house —90,000 square feet with 23 full bathrooms, a 6,000 square foot master suite with a bed on a rotating platform—only to be forced to put it on the market because “we really need the money”. 
 
• Repo men who are now the scavengers of the wealthy, picking up private jets, helicopters, yachts and racehorses – the shiny remains of a decade of conspicuous consumption financed with debt, asset bubbles, “liquidity events,” and soaring stock prices. 

• How “big money ruins everything” for communities such as Aspen, Colorado whose over-reliance on the rich created a stratified social scene of velvet ropes and A-lists and crises in employment opportunities, housing, and tax revenues. 

• Why California’s worst budget crisis in history is due in large part to reliance on the volatile incomes of the state’s tech tycoons. 

• The bitter divorce of a couple who just a few years ago made the Forbes 400 list of the richest people, the firing of their enormous household staff of 110, and how one former spouse learned  the marvels of shopping at Marshalls,  filling your own gas tank, and flying commercial. 
Robert Frank’s stories and analysis brilliantly show that the emergence of the high-beta rich is not just a high-class problem for the rich. High-beta wealth has national consequences: America’s dependence on the rich + great volatility among the rich = a more volatile America.  

Cycles of wealth are now much faster and more extreme. The rich are a new “Potemkin Plutocracy” and the important lessons and consequences are brought to light of day in this engrossing book.
 
high-beta rich (hi be’ta rich) 1. a newly discovered personality type of the America upper class prone to wild swings in wealth. 2. the winners (and occasional losers) in an economy that creates wealth from financial markets, asset bubbles and deals. 3. derived from the Wall Street term “high-beta,” meaning highly volatile or prone to booms and busts. 4. an elite that’s capable of wreaking havoc on communities, jobs, government finances, and the consumer economy. 5. a new Potemkin plutocracy that hides a mountain of debt behind the image of success, and is one crisis away from losing their mansions, private jets and yachts.

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Editorial Reviews

Publishers Weekly
Just like Toto tugging at the curtain to reveal the wizard of Oz, Frank (Richistan) lifts the veil shrouding the nouveau (and extremely) riche to expose the sources of their new fortunes and the extent of their excesses. Some of his findings are certainly not groundbreaking—“The wealthy, who were once America’s most savvy savers, are now the nation’s biggest spendthrifts”—but it’s the scale that astounds. Frank’s book is a Baedeker to a Shangri-la of Versailles-size mansions and estates, rampant consumption, private jets, yachts, and extensive household staff. While the recession continues to wreak havoc in the economic lives of the nation’s middle- and low-income population, Frank provides a cogent explanation of how megabillionaires have contributed to today’s economic conditions and heightened economic inequities. Furthermore, he shows that few are genuinely interested in job creation or the long-term prosperity of others. Frank’s readers are left with a depressing sense of an economic order where the average American family will continue to see a decline in its standard of living with few solutions in sight. (Nov.)
From the Publisher
"The High-Beta Rich vividly illustrates how the wealthy and those they employ have become increasingly tied to the vicissitudes of the stock market and the macroeconomy. It is a cautionary tale for all." —Steven Neil Kaplan

Product Details

ISBN-13:
9780307589897
Publisher:
Crown Publishing Group
Publication date:
11/01/2011
Pages:
256
Product dimensions:
5.80(w) x 9.30(h) x 1.20(d)

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From the Publisher
"The High-Beta Rich vividly illustrates how the wealthy and those they employ have become increasingly tied to the vicissitudes of the stock market and the macroeconomy. It is a cautionary tale for all." —-Steven Neil Kaplan

Meet the Author

ROBERT FRANK is the author of the New York Times bestselling Richistan: A Journey Through the American Wealth Boom and the Lives of the New Rich. He is a senior writer for The Wall Street Journal and writes "The Wealth Report," a daily blog focused on the culture and economy of the wealthy and formerly wealthy. Robert has been with the Journal for 15 years, with postings in Atlanta, London, Singapore, and New York. He lives in New York.

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