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9 Aug 2022

This reminds me of a conversation I had recently with a Swiss woman from Geneva

While I think the people with $5 million homes on the Lake are rich, I think your friend shows meaningful familiarity with wealth when she draws a higher line for the truly rich than most people do

I made the mistake of referring to someone she knew with a $5 million dollar house near Lac Leman as being installment loans for bad credit Iowa “rich”.

The Genevoise turned up her nose at this idea, and suggested that he was nothing but “un petit riche” or “un poseur”. In order to be *vraiment riche* she assured me, you needed a minimum of *at least* $50 to $100 million.

His neighbor considered paying cash for his house, but was able to borrow $4 mill at 6%, and invest it in his business and get a 10% return

I started to object to this (where does that leave the homeless, the unemployed, should they even be allowed to exist?) but I decided there was no point in pursuing the conversation.

I agree with both you and your Genevoise friend. I’ve been amazed at how many people in the U.S., from those with tens of millions of dollars in assets down to much of the middle class, conflate their interests with those of the ultra rich. A more divided society is sometimes a good thing.

Hmmm, I’m afraid you misunderstood my post. I never said this Genevoise was a friend of mine, merely someone I happened to have a brief conversation with, although not nearly brief enough, as far as I’m concerned.

And I was trying to convey her sense of snobbism, entitlement and superiority in referring to someone with a $5 million home as “un petit riche” (a little rich) and “un poseur” (a poser). As if only someone with $50 to $100 million was worthy of her respect.

Personally I find the snobbism of this attitude to be appalling and reprehensible, but it seems to be quite common among those who are “truly rich”, as you put it, or merely aspiring to that category, the “posers”, as Richard Cameron refers to them.

“The mass of the rich and poor are differentiated by their incomes and nothing else, and the average millionaire (or billionaire, if you insist) is only the average dishwasher dressed in a new suit. Change places, and handy dandy, which is the justice, which is the thief? Everyone who has mixed on equal terms with the poor knows this quite well. But the trouble is that intelligent, cultivated people, the very people who might be expected to have liberal opinions, never do mix with the poor. For what do the majority of educated people know about poverty?”

I think it is more likely I was sloppy in my post than I mis-understood yours. I got that she wasn’t truly your friend and I got that she was being obnoxious.

But this woman’s remark highlights something that strikes me as very important: that many people, including much of the upper middle class in the U.S., make the mistake of seeing themselves as having common interests with the ultra rich. I think tension and snobbery, annoying as they are, counter-intuitively serve the purpose of keeping clear that there are greatly divergent interests between billionaires and people with say, $20 million dollars.

In short, I’d take the snobbism and division, with all its problems, over a coarse grained view of wealth that implores large portions of the better educated and more comfortable to contribute to a very primitive political economy.

i think i was not clear in my post with respect to the “poser” issue. my point did not really have to do with the value of the house. If you buy a house (for $50k or $500K or $5M or $50M) and you have to worry about how you are going to make the mortgage payment, then you probably cannot afford it. to me, if you can afford a house, that means you can pay cash for it, and are simply using a mortgage as a financing tool. if you can do that, you are “rich”. typically, that is not the case until you get into the million dollar plus homes. that is where the problem arises – two people live next door to each other in $5M houses – both are considered “rich” by the public. One person has to manage his spending so as to be able to make his mortgage payment – he is not “rich”. He is “rich”.