It seems to me that the acquisition of wealth by those with wealth can largely be attributed to a combination of two intimately connected concepts, delayed gratification and the superior returns of illiquid assets. Delayed gratification is simply the ability to choose two dollars tomorrow instead of a dollar today. It’s generally considered a sign of maturity as rare is the 5 year old who would choose two cookies now as opposed to one right now.
Where this begins to get interesting is when it gets in to the realm of economics, accounting and finance. Though the difference between economics and psychology is merely the introduction of math. In the absense of trade, if you want something you have to grow it, hunt it or make it yourself. All of these things have the similar trait of taking a long time as well as being to a greater or lesser extent prone to failure. As you add trade via barter you can substantially improve your ability to quickly obtain goods with little fear of failure. It’s only a short hop from there to money and your ability to get goods quickly and error free is extremely good and mainly a factor of the local economy as opposed to your own abilities. Though you still need to have that cash on hand in order to obtain goods; enter credit.
Modern America thrives on credit, it’s no longer about how much cash you have today, but how much cash you conceivably have over the next year (or decades if you’re talking about a home) and since that’s almost always more than you have today, the economy goes rolling along. I’m pretty sure The McCombs School of Business essentially hands out degrees for understanding the time value of money; Einstein reportedly said that “compound interest is the most powerful force in the universe”. And yet this country is continually choosing to be on the losing end. The inability to exercise delayed gratification leads to a massive decision to buy liquidity for the immediate purchase of goods.
Modern finance has created a number of assets that allow spreading the finance of that debt to basically anyone able to lay down capital. So people unable to pay for stuff are paying percentages of sums they don’t have to people who have those sums lying around and are willing to forgo their purchasing power for a period of time for the return. The poor pay the rich for the opportunity to have money.
There is a silver lining for those who are capable of living within their means. If you’re willing to do that, you can watch your money grow by allowing other people to spend it. After all, that’s essentially all you’re doing in a modern day capital or equity market, selling your liquidity. Unless of course the collapse of the sub-prime housing market was just the foreshock of a complete collapse of our economy built on a rough approximation of future money.