The tale of two worlds – the fabulously rich and the increasingly poor – is a defining narrative of contemporary life, and it continues to throw up vivid reminders, at once doleful and grimly hilarious.
One of the latest examples was told by the writer and provocateur Matt Taibbi, famed for having described Goldman Sachs as “a great vampire squid wrapped around the face of humanity, relentlessly jamming its blood funnel into anything that smells like money.”
In a recent Rolling Stone blog post, Taibbi related a confrontation between Jamie Dimon, chief executive of JPMorgan Chase, and the analyst Mike Mayo of Credit Agricole Securities during an investor conference call earlier this year. These calls are where analysts get to question the masters of the financial universe about their actions. Mayo asked Dimon if investors would not prefer a bank – he offered UBS as an example –that had a higher capital-to-debt ratio. The exchange then went:
Dimon: So you would go to UBS and not JPMorgan Chase?
Mayo: I didn’t say that … that’s their [UBS’] argument…
Dimon: That’s why I’m richer than you [raucous laughter].
Taibbi used the anecdote to show, as he said, “how these guys think.” To push that thought a little further: It’s how people, who live highly stressed lives with much depending on their judgments, think of themselves: that they are worth it. The conventional view is that every company of size and reputation needs several of these people so it may survive. In effect, large wealth has now been given a rational, maybe even a moral, underpinning.
At around the same time, a number of other matters came to light. Forbes Magazine published its billionaires’ list, which revealed that there are 1,426 of these exotic creatures, with 210 in the superleague for the first time. A little over a third of them are in the United States; 23 are under 40; 386 are in the Asia-Pacific zone, 366 in Europe, 129 in the Americas and 103 in the Middle East and Africa. United, the billionaires of the world command $5.4 trillion, up from $4.6 trillion last year, and now worth one-third of annual U.S. output. The Mexican Carlos Slim, with $73 billion, remains on top, and Bill Gates, with $67 billion, remains at No. 2. But there’s a newcomer at No. 3, rudely elbowing aside the sage of Omaha, Warren Buffett – the Spanish entrepreneur Amancio Ortega, who owns a majority stake in Zara, the world’s biggest clothing company,. He added nearly $20 billion to his fortune in a year, which came out at $57 billion.