[lbo-talk] A $95, 000 question: why are whites five times richer than blacks in theUS?

[Andy]

On Tue, May 18, 2010 at 10:31 PM, shag carpet bomb <shag at cleandraws.com> wrote:
>
> isn't it really as simple as: your grandma bought a house for 10k and
> it is now worth $500k, when you sell it after her death. your mom and
> day had a similar dealio, socking away 500k after they sold it. plus,
> they had their savings and the life insurance policies.
>
> now, you "inherit" "wealth".
>
> this makes a massive difference in your life, the decisions you make,
> the colleges you can attend or send your kids to, the business you can
> or can't start, the investments you can or can't make, the house you
> can or cannot afford, etc.
>
>
>> James Heartfield writes:
>>
>>> income differential is enough to account for the difference
>>> in ability to save and raise a mortgage on a house, the climbing
>>> value of which, I would guess, is the reason for the difference
>>> in wealth (i.e. fixed assets, not income).
>>
>> The study specifically excluded housing wealth, but nice to see that
>> you
>> even read the article -- let alone the paper itself.
>>
>> I've seen a lot of claims that it's as simple as missing out on the
>> last
>> few bull markets over the last 20 years: Whites participated and grew
>> wealthier; Blacks didn't.  I've also seen some speculation about "the
>> culture of investing" and whether Blacks, as a group, "trust"
>> investments.  It seems like there's a lot of reasons, none as
>> slam-dunk
>> as Doug's "inheritance, mostly" claim.  If it was "mostly"
>> inheritance,
>> you'd have to believe that the difference between the two groups from
>> start to finish is that the White group had someone with some wealth
>> die
>> during the 20 year period.  So while I'm sure there's some of that, it
>> certainly doesn't seem clear that it's "mostly" any one thing.
>>
>> The most alarming thing to me was that it used to be the case that
>> high-income Blacks had more wealth than middle-income Whites but
>> that's
>> no longer true.  That seems really crazy.
>>
>> /jordan
>>
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-- 
Andy