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harryh

Wealth and income are very highly correlated especially when you also take into account age.

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Bollocks.

Half of the families in London sitting on hundreds of thousands in net worth earned around median in their primes.

The same is likely true in SF and elsewhere.

London and San Francisco are not typical cases though. Most people earning median income, but living elsewhere, did not participate in a housing market with such dramatic price increases.

(As a side note, it's now impossible for people earning median income to participate in those markets, due to the expense).

EDIT: That said, I do think that income is over-emphasized in categorizing people as rich or not. A person who lucked into a house that went up in value might not feel rich, but they definitely are richer than the person that has to borrow a million more dollars to live in the house next door.

And even for people who have most of their net worth tied up in appreciated housing have high incomes when you count imputed rent.

Which, if you are not counting, you are just being silly.

And those people now have high incomes due to the return on capital they can get from their net worth.

Addressed in my OP.

The man on the clapham omnibus will not tell you that a person who owns a house and works in the supermarket has a high income.

They might say that they're rich though. Because wealth is the thing that makes you rich.

I would even argue consumption is the best measure to use.

even that have been gamed, when CEOs make their company pay for a lot of their stuff, or people have a non-profit owning their mention.

I see that sort of thing come up a lot, but is there, like, a blow-by-blow guide out there for how they get to that position without running afoul of the law? Is it something you can only do with expensive tax lawyers and money to throw around for a bunch of temporary maneuvers, or is it something your average freelancer/consultant with an LLC can pull off?

the fix cost is too high for non wealthy people to do it, you need a few thousands of dollars in layers, accounting, various registrations, etc.

The IRS has very strict rules on what counts as compensation. The idea that CEOs are significantly circumventing them is mostly wrong.

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