Photo: Wikipedia Commons
During his latest presentation, bond manager Jeff Gundlach posted a chart comparing wealth concentration in America vs. that of other developed countries, and of course, America leads the world in terms of total income accruded to its top 0.1% of earnings.In the words of Gundlach, this is a “societal problem.”
Now, you can make good arguments for why this kind of wealth disparity exists, and you can argue that it’s immoral to transfer money from the successful to the less so against their will.
But as Gundlach put it: The money will be transferred somehow, either through higher taxes or through revolt in the streets. It’s just a matter of time before one happens.
The US may not be Greece financially, and societal collapse seems unlikely hear, but in this debt fight that’s happening here right now, a hardline stance on taxes combined with a blow to that social safety net only increases the chance that the transfer will happen on the streets, and not orderly through taxes.
This was a big part of Gundlach’s presentation: The disparity between the exploding wealth of the top 0.1% and the growing number of Americans on foodstamps. Ultimately, this is untenable.
The rich need to pick their poison.
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