E TalkMarkets Tuesday Talk: Of Brexit And Brandade

The pattern for the 50th-90th percentile is where the big shift happens. This group had about 36% of total wealth in 1990 and still had about that same share in the early 2000s. But since then, its share has dropped down to about 29% of total wealth. In ownership of real estate or financial assets, this group is benefitting considerably less from the run-up in wealth/GDP than the top 1%. This group is often what is called the "middle class" in a US context."

If you missed that, Taylor is talking about Joe and Jane Investor. Some smelly fish indeed. Taylor includes the following charts (and others) for illustrative purposes:

Wealth held by top 1%, 99th to 100th Wealth Percentile

Wealth held by the "Middle Class", 50th-90th Wealth Percentile

TalkMarkets contributor David Vomund in a TM exclusive, Be An Optimist, reminds us that history reveals that over time, the stock market provides proven rewards for those willing to take properly calculated risks. His words below are certainly timed to the holiday season:

"For those 60 and younger, however, it’s important to know that there is more than 100 years of data suggesting a large portion of their portfolio should be in stocks, especially the more stable large-cap dividend payers. For those over 60, own some higher-yielding fixed-income instruments and preferreds in addition to stocks. 

What about buying at the high? If you bought the S&P 500 at the top right before the 2008 financial crisis you’d be up 220 percent today, including dividends. If you bought in February 2020 right before COVID-19 you’d be up 15 percent. Every bear market ends with stocks soon hitting new highs. If your timing is bad and you buy near the top, the next bear market will make it right. It already has."

In a TalkMarkets Editor's Choice column, Robert Rapier looks at the oil industry. In The Oil Industry Is Climbing Out Of A Hole, Rapier notes what some people may have overlooked:

"Since early November the oil industry — which some had declared dead after the crushing losses earlier in the year — has gone on an impressive rally. ExxonMobil (XOM) shares are up 27% in one month. Chevron has risen 37% (CVX). Royal Dutch Shell (RDS-A) shares are up 60%. ConocoPhillips (COP) is up 49%."

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William K. 2 months ago Member's comment

Very interesting and also quite educational. And the rich get richer because those setting the rules want to "take care of their friends." Certainly those in government know how to help themselves. AND by the way, that is NOT doing meany favors. The fact, verified by history, is that people will put up with a great deal of misery, if it is heaped on slowly. Then all at once, just a small bit more, and the revolution ignites, or even explodes. Where that level of misery that leads to revolution can only be guessed at, and what will trigger the explosion may be a very small spark that did nothing a hundred times before. Thus the government and the 1% really need to remove some of the misery occasionally.