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The corrolay of this would be that as soon as money enters a "rich-only" ecosystem, it's essentially gone forever for the wider population. I don't see how this would be a desirable outcome.

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It creates rich-people dollars and poor-people dollars. The poor people can still afford a buy a few necessities because rich-people money is tied up in useless vain endeavors, at least to some extent. If rich were to direct all their purchasing power toward real goods they could drive up the prices and make it unaffordable for regular people. As happens with the housing market to some extent.

Edit: unautocorrect

> As happens with the housing market to some extent.

As happens in any market with limited supply, which generally means desirable land and luxury goods.

All demand is not created equal. The rich buy more houses than they need for shelter, in order to produce income. This essentially creates an artificial shortage of homes for purchase by actual homeowners. I believe that is what the commenter was referring to.

* corollary

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