Of course people in US are very wealthy if you are looking at dollar amounts. It would be impossible for cost of living to be this high, without a lot of people having decent amount of wealth.

But people's perception of their own wealth depends way more on relative value of their wealth compared to cost of living. If you live in a city where some shitty 2 bedroom apartments cost 1m$+, you aren't going to feel all that rich even if you have 10 million dollar net worth.

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schmidtleonard 3 hours ago | parent | next [-]

$10M at 10% returns is $1M/yr passive. That'll pay for an expensive apartment before you consider working.

In fact, that's sort of the problem: the massive "rich people get paid for being rich in proportion to how rich they are" cash flows run away exponentially from the "poor people get paid for working" cash flows, inflating the price of any inelastic good beyond their reach. The economy stops being about work and starts being about wealth. Which might be fine if most people were wealthy enough to not work, but that's overwhelmingly not the case so it's overwhelmingly not fine.

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tzone 3 hours ago | parent [-]

No sane person would "feel wealthy" if they are living in a shitty 2 bedroom apartment, even if the place costs 1m$. In places where shitty apartments cost that much, a place that would be considered "luxurious" can easily cost 5m$ or more.

Of course rational thing to do would be to take the money and move to a less expensive city, but with the same logic, anyone who has 1m net-worth could liquidate their assets, move to a different country, retire and live a proper wealthy lifestyle.

But we don't see that happening all that much at all. Mostly what happens is that people are choosing to live middle class lifestyles in most expensive areas that they can afford.

	▲	schmidtleonard 2 hours ago \| parent \| next [-]
		I agree with your point, just not with your numbers. Even your new numbers: $10M NW, half of it goes to luxury housing, the rest gives you $500k/yr of passive income and that's pretty damn nice by any standard that doesn't involve employing others. I get that this is HN where many of us aspire to such things, but surely that's beyond the point where one should feel wealthy?
	▲	sublinear 2 hours ago \| parent \| prev [-]
		Wait, are you accusing the wealthy of being actual humans who value things besides money?

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AnotherGoodName 3 hours ago | parent | prev [-]

The mean and the median wealth differences is the most striking. USA is second on mean wealth and 27th in median (just ahead of Greece). A few trillionaires pulling it up with nothing trickling back down.

Still wealthy either way but I always find it a bit jarring how skewed the US self perception is since people generally experience something closer to the median.

	▲	scarmig 3 hours ago \| parent [-]
		Note that Caplan is focusing on medians and percentiles in his table, not on means.