Hawaii: Catering to the Fewer

We stayed in a Waikiki hotel in 2012

The number of tourists to Hawaii hasn't recovered to 2019 levels, but total tourist spending of $11 billion in the first half of 2025 is nearly 24% higher than the first half of 2019. [bold added]

The shift toward fewer visitors who are spending more reflects the type of visitor Hawaii is now aiming to attract.

“It’s better for everyone, us residents, the infrastructure, and yes, even the industry. Hawaii doesn’t need more people. We need the right people, the ones who respect the place and are willing to invest back into it, this is what I have been pushing for years,” Bruce Fisher, Hawaii travel adviser and owner of Hawaii Aloha Travel, told SFGATE in an email.

Your humble blogger is a frequent returnee, but because he is able to stay with relatives has not been the target demographic for the Hawaii Visitors Bureau. For one out of five trips we'll splurge and stay in a hotel, and I must admit that Waikiki is very pleasant to walk around at night. Age and health will limit our future trips, so we'll be opening our wallets more. Besides, I've always wanted to be thought of as being among the "right people."

The Club I Can Never Join

(WSJ graphic - darker blue circles are women)

Using data from Altrata, the WSJ profiles America's billionaires:

There were 1,135 billionaires in the U.S. as of 2024—up from 927 in 2020, according to data from Altrata, a wealth intelligence firm. The biggest concentration, 255 of them, is in California. But the super rich are also behind businesses in places such as Ridgeland, Miss., and Waunakee, Wisc.

Collectively, these people are worth about $5.7 trillion, according to Altrata’s estimates... The 100 richest billionaires account for nearly $3.86 trillion in wealth—more than half the total. Just three men—Elon Musk, [Jeff] Bezos and Mark Zuckerberg—account for almost $1 trillion of it.

Billionaires have publicly donated or pledged to give about $185 billion since 2015, according to Altrata. Mostly, they support causes such as education and medical research—they gave $90 billion to those two in the past 10 years. That has given them sway in ongoing campus debates over freedom of speech and antisemitism.

While some billionaires such as [Bill] Gates and Warren Buffett have openly pledged to give away much of their wealth, others have donated little so far. About a quarter of the billionaires in the list have known donations of less than $1 million in the past decade.

I'm wary of concluding that billionaires are selfish based on their lack of known donations. If I were a billionaire--of course, I'll never be part of that club--I would keep my donations quiet, both so I would not be inundated with other requests and because of the ethic against self-glorification.

I never knew a billionaire,
Such a life, I would not choose it
Too much time would be ensnared
Worrying about how I could lose it.
---inspired by the Purple Cow

If You Have to Ask, You Can't Afford It

(Photo from charity buzz)

From 2009 to 2016 I was a regular viewer of Royal Pains, USA channel's romantic dramedy about a startup concierge medical practice in the Hamptons. The show had the difficult-to-diagnose conditions that doctor shows usually have and multi-season story arcs. The millionaire inhabitants of the Hamptons were sometimes gently mocked, but there were no pure villains. When the series wrapped, the practice had become successful, and all the major characters had resolved their conflicts.

Now there are several concierge doctors in the Hamptons, and one even attributes the founding of his business to the TV show.

Along with other areas with surging centimillionaire and billionaire populations such as South Florida, the Bay Area, New York City and Los Angeles, the East End of Long Island is teeming with concierge doctors who treat patients swiftly (usually), discreetly (hopefully) and expensively (always). These doctors charge a membership fee anywhere from a few thousand dollars to six figures a year, with one-off house calls on top of that often starting around $1,000. These doctors do not typically accept insurance.

“Money is not an obstacle,” Rashid said. “Not only can concierge medicine provide fast service, it also provides advanced medicine.” Rashid, a family physician who trained in Miami and New York and has worked in the Hamptons for 15 years, opened a branch of her company in Palm Beach, Fla., in 2021 for their snowbird clients.

The Hamptons concierge-medicine boom started in 2020, when doctors saw an opportunity to test and treat the affluent community working remotely from their beach houses. Nationwide chain Sollis Health, which focuses on emergency medicine, started a center among the tony horse farms of Water Mill in 2021. Other options include Casa Health, White Glove Medicine and individual practitioners including Dr. Magdalena Swierczewski, M.D., and Dr. James Giugliano, D.O.

Dr. Golberg treats a couple aboard their yacht

Many of these doctors bill themselves as one-stop shops for all family medicine needs. Some do cosmetic services, several specialize in increasingly popular antiaging and integrative-health services, while others rush over to White Parties in the wee hours when things go awry. All of them know their way around Lyme disease and addiction issues.

[Dr. Alexander] Golberg had the idea to begin practicing concierge medicine in the Hamptons after watching “Royal Pains,” a television show that ran from 2009 to 2016 about a doctor who does just that. An entrepreneurial type, Golberg immigrated from Russia in 1989 and worked at his cousin-in-law’s cubic zirconia business after medical school. He has an M.D. from St. Petersburg Medical Academy and a D.O. from the New York College of Osteopathic Medicine, and is board-certified in family, osteopathic, antiaging and regenerative medicine.

Patients get instant, personalized service in exchange for paying annual six-figure fees, and their clients are happy to pay it,

The Private-Jet Money Club

Last year we noted a WSJ article about how the super-rich signal their wealth to each other and to the merely rich. Owning items such as watches and art are only the first step; talking about them with casual insouciance is a practiced skill.

Flying private makes it easier to bring Fifi (Citrin-Safadi/WSJ)

Another item discussed in that article--flying on a private jet--has become the number one marker of real wealth.

Flying private has become the ultimate luxury splurge for many wealthy individuals, surpassing Ferraris, Hermès Birkin bags topping $14,000 or even waterfront Hamptons homes. For many of those aspiring to join the ranks of the truly rich, having “private-jet money” is the new goal, dividing the 1% from the 0.1%.

The pandemic unleashed a burst of demand, but providers say popular culture has turbocharged enthusiasm and envy for the fly-private lifestyle. Social media has given younger people a glimpse into the lives of jet-setters, whether it is a model flying with friends to a bachelorette party in Los Cabos, Mexico, or a hedge-fund manager hopping a plane to a birthday weekend in St. Barts.

...The club of ultrahigh net worth individuals with more than $30 million in assets hit a record in 2024, according to estimates from the wealth-intelligence provider Altrata. The U.S. added more than 1,000 millionaires every day last year on average, according to UBS. The billionaire club grew more than 50% between 2015 and 2024.

Thee are surely sub-categories within the private-jet club, ranging from those who lease the planes occasionally to those who own the plane outright and pay their crews as full-time employees (much like the difference between owning a time-share versus the entire property).

Note: Grok describes the difference between the 1% and the 0.1%.

As of Q2 2024, the average wealth of households in the top 1% in the U.S. is about $35.5 million, while the top 0.1% have an average wealth of over $158.6 million. This means the top 0.1% hold roughly 4.5 times more wealth per household than the top 1%. The top 1% collectively hold 30.3% of total U.S. wealth ($43.45 trillion), while the top 0.1% own 13.5% of it. The wealth gap reflects the concentration of assets like corporate equities and business income among the ultra-wealthy.

Wealth Ladder - Getting the Rungs Right

I'm a sucker for "rate yourself" tests on the Internet, for example, how do you measure up in health, sports knowledge, 20th century history, or wealth? Concerning the latter, Nick Maggiulli's Wealth Ladder has specific numerical criteria: [bold added]

Those on the first rung have almost no wealth; the threshold is less than $10,000. Each subsequent rung represents an upper threshold of wealth 10 times as large as the previous level. Mr. Maggiulli’s scale is designed to express the declining utility of money as it accumulates. He also denotes each rung by the “freedom” such wealth generates.

Level 2, $10,000 to $100,000, offers “Grocery freedom” because “you can buy what you want at the grocery store without worrying about your finances.” Level 3, $100,000 to $1 million, provides “Restaurant freedom” because you can order what you want when you dine out. The fourth rung, $1 million to $10 million, means you can travel wherever you want; the fifth, $10 million to $100 million, means you can afford the home of your dreams. Mr. Maggiulli’s sixth and highest level, anything above $100 million, gives you the ability “to have a profound impact on the lives of others” through business and philanthropy....

Mr. Maggiulli recognizes that knowing which rung of the ladder you’re on doesn’t help in getting to the next one, so at each level he describes what is required to climb higher. Getting more education is most effective at Level 2. Income-producing assets are vital at Level 3. Once you get to Level 4, you’re going to have to take a different approach. If you reached Level 5 it is probably thanks to concentrated investments—the result of starting a business or accruing a big slug of company stock.

Some rungs are far too wide. Rung 3 spans $100,000 to $1,000,000, but IMHO there is a huge difference between the low and high end of the range. In the Bay Area $100,000 could be a half-year's salary, perhaps enough for an emergency expense reserve, while $1 million in many parts of the country allows one to have a paid-up home plus hundreds of thousands of dollars in savings.

There is a similar difference between $1 million and $10 million; again in the Bay Area, the lower amount could be a down payment while $10 million does allow one to have that four-bedroom house plus a comfortable retirement.

As for rung #5, over $100 million, I'll never get there and I'm glad because I don't need those kinds of problems (he said disingenuously).

Update - 7/29: Nick Maggiulli elaborates in a Morningstar interview.

Christine Benz: You share what you call as the 0.01% rule. Can you talk about what that is and how it can aid with decision-making about doing spending, and what expenditures to stress out about and which to not stress out about?

Nick Maggiulli: Yeah, so the 0.01% rule basically says that you can spend 0.01% of your wealth or just another way of looking at it’s one-10,000th. So you could call this the one-10,000th rule as well. You can spend one-10,000th of your wealth on a daily basis without having to worry about anything. And so I’ll explain where that comes from. So let’s say your net worth is $10,000. You’re basically right on the cusp between level one and level two. That means you can spend an extra $1 per day without any worry about jeopardizing your future wealth. And where that $1 that 0.01% comes from is, on an annualized basis, if you’ve got a return of 0.01% a day, that’s like a little bit under 4% a year. It’s like 3.7% a year. It’s very conservative return. So every day your wealth is generating that much money. So if you have $10,000 in wealth every day in theory, you’re generating an extra $1 a day without doing anything. So in theory, you could spend that $1 and not jeopardize your future wealth. So if you have $100,000 in wealth, you could spend $10 a day. If you have $1 million in wealth, you can spend $100 a day, et cetera. Now, obviously this isn’t your total spending. If you live in the United States, you’re not going to survive on $1 a day. This is the marginal spend. Everyone’s making a spending decision, you’re making it on the margin.

Like when you go to buy a car, you’re not saying, oh, should I get a Toyota Camry or a Maserati? You’re debating between the Camry and the slightly nicer Camry. That’s what I’m saying. You’re always doing it on the margin. Like when you sit down in a restaurant and you’re like, do I want to get the burger for $20 or the salmon for $30? That marginal difference is $10. And so my argument is that once you have like $100,000 in wealth, that extra $10, you can spend that every time you go to a restaurant without worrying about it. And so the 0.1% rule works in that way by just it allows you to have some lifestyle creep because you’ve shown financial disciplines. Like, hey, look, I’ve reached this level of wealth so I can now spend more in certain categories. But until I reach that level of wealth, I’m not going to do that.

And so like in my example—I still to this day, I don’t have basically any travel freedom. When I go to a restaurant, I’ll buy whatever I want. I don’t care. But I am still getting the coach seat. Maybe I will upgrade my seat to a slightly nicer seat, not a first-class seat, but I’ll go like get something with more legroom. That’s where I’m at in my wealth journey. Like one day if I do well, if things go well for me, I will maybe always get a first-class seat, but that’s not in the cards for me right now. And so I’m spending according to my wealth level, and I’m very strict about that.

It’s because that the extra whatever $100 or whatever it is, is not enough to upgrade to first class every time. So I can’t spend that money. That’s how I work through it.

Costco: the Good Times are Back

Next to the $14.99/lb ribeye were steaks going for $59.99. A second look revealed that the price was $59.99 per pound. It was wagyu beef, which we had seen in Japan decades ago for $100 per pound, so the Costco price was a relative bargain.

In past years we have gawked at the occasional Costco offerings of $550 hams and $2,150 cognac. Of course, we never pulled the trigger, nor did we do so on the wagyu steaks with the cheapest package going for $240.

Nevertheless, the marketing and buying geniuses at Costco would never have displayed the luxury ribeyes unless there was a good chance they would be bought. The good times are back.

Watching a Subspecies of Money Men

Last month we commented about how the super-rich signal their wealth to each other without making it obvious that's what they're trying to do. But not all of them, or those trying to be as wealthy as they are, are into that game at least when it comes to timepieces.

WSJ: The Anti-Status Watch: Why Men in Finance Love Cheap, Cheesy Watches

Sponge Bob and Avengers watches worn by financiers
Patrick Lyons and Leroy Dikito (WSJ/Lyons/Dikito)

Though finance guys famously flaunt Rolexes or Patek Philippes on their wrists, an established subspecies of money men goes the other way entirely. In place of a sleek steel case and elegant ceramic dial? Mickey Mouse. SpongeBob SquarePants. Fanta-orange rubber straps.

Over the years, highfliers have made headlines for sporting Swatches. (See: Blackstone Group CEO Stephen A. Schwarzman or former Goldman Sachs CEO Lloyd Blankfein.) That “wealthy guy, cheap watch” ethos continues to resonate in boardrooms and on trading floors, with men of all seniority levels embracing plasticky, offbeat designs, from superhero models to calculator Casios. Many resemble something you might win in a claw machine. Priced from $30 to a few hundred bucks, they’re a bit of fun and a different sort of flex, conveying an “I don’t need a Rolex” bravado that comes from having made it. Call them anti-status watches.

A practical reason for this anti-status affectation: cheap, everyday watches can be used as conversation starters in business conversations.

It's also possible to be viewed as truly wealthy, especially if everyone knows that a person is rolling in it, by not appearing to care about looking the part. The psychology of wealth, like the most important aspects of life, can be complicated.

A Choice, But Not Really

The priest read from Mark 10:

Jesus, looking at him, loved him and said, “You lack one thing; go, sell what you own, and give the money to the poor, and you will have treasure in heaven; then come, follow me.” When he heard this, he was shocked and went away grieving, for he had many possessions.

Then Jesus looked around and said to his disciples, “How hard it will be for those who have wealth to enter the kingdom of God!”

It is true that most people---yours truly included---try to build up their wealth to a point where it provides protection against the exigencies of life. It's very difficult to "sell what you own, and give the money to the poor" and trust in God to take care of our future.

There are other examples in the Bible of how money is an obstacle to faith. Later in Mark, Jesus observes, "It is easier for a camel to go through the eye of a needle than for someone who is rich to enter the kingdom of God."

However, it would be a mistake to focus on wealth as the sole impediment to faith. I have encountered people who claim that money is not important to them. Putting aside whether I believe them or not, I have observed that certain activities (cooking and dining, sports, grandchildren) are their highest priority--and just ask some young people to turn off their phones for a day.

It's very difficult to leave everything behind, though the irony is that we eventually will have no choice in the matter.

Money and Happiness: Not So Simple

We've commented before on the 2010 study that asserted that more money does lead to happiness, but only up to a relatively modest level of income, i.e., $75,000 per year:

In 2010 Daniel Kahneman and Angus Deaton analyzed data from over 450,000 responses to a daily survey of 1,000 U.S. residents by the Gallup Organization. They found that money does influence happiness at low to moderate levels of income. Real lack of money leads to more worry and sadness, higher levels of stress, less positive affect (happiness, enjoyment, and reports of smiling and laughter) and less favorable evaluations of one’s own life. Yet most of these effects only hold for people who earn $75,000 a year or less. Above about $75,000, higher income is not the simple ticket to happiness that we think it is.

(WSJ illustration)

Since that 2010 study more research has been performed on the relationship between money and subjective well-being. Now it seems that more money in absolute terms does make higher-income people happier. [bold added]

A big raise provides significant boosts in happiness even at household incomes of $500,000, according to a new research report...according to a paper by Matt Killingsworth, a senior fellow at the University of Pennsylvania’s Wharton School, the bonuses and leaps in income high earners reap are so large that they keep adding to well-being in the same way that smaller pay bumps do at lower tiers of earnings.

“I think of this as a ladder across society. The rungs are separated by more and more dollars, but exactly the same amount of happiness,” said Killingsworth, who published his report on his Happiness Science website.

An academic paper in 2010 popularized $75,000 as the salary threshold beyond which earning more money didn’t make people any happier. More recent research indicates that there is no such plateau.

Killingsworth and other researchers stress that many things influence human happiness, including your relationships, your job and the country you live in.

“No single factor, including money, dominates the equation,” Killingsworth said.

Previous studies on money and happiness have consistently demonstrated two things: that richer people are happier, and that it takes progressively more money to keep generating a well-being boost of a given size.

It makes sense that more money always makes people happier, ceteris paribus.

However, as people age money's importance diminishes (caveat: as long as one has enough to provide for retirement and health care) and no longer is the measuring stick of one's life; family, legacy, and discernment of life's meaning become foremost.

I wonder if there's research being performed on that.

HENRYs

In 1980 the "young urban professional" (YUP-py) was identified as a significant cohort, and ensuing demographic acronyms have never stopped coming.

DINKs (double income, no kids), BOBOs (bourgeois bohemians), WEIRD (Western, educated, industrialized, rich, and democratic) all have had their place in the sun. Now there are HENRYs (high earner, not rich yet). [bold added]

Fifteen years ago if you’d told April Little that she’d make $300,000 a year, she would have pictured a life free of financial stress.

“The white picket fence—I have the whole visual in my head,” says Little, 38 years old, a human-resources executive turned career coach in Rochester, N.Y. “I don’t want to sound ungrateful, but when I got to that proverbial mountaintop I realized there’s a lot of expenses. And I still don’t own a home.”

So go the plush-but-not-too-plush lives of the Americans who qualify as HENRY—high earner, not rich yet.

Little makes multiple six figures running her own business but carries $90,000 of college and grad-school debt. Child care and education for her three children would be so costly that she and her husband decided the better option was for him to leave his radio job to parent and home-school full time.

New census data show 14.4% of U.S. households bring in $200,000 or more a year, a near record. Yet the money doesn’t have the buying power those earners wish it did, partly due to the rising prices hammering us all and partly due to the supercharged costs of things like houses and cars. HENRYs describe feeling stuck on a hamster wheel—a nice one that other hamsters envy—but running in place nonetheless.

Oh come on, you’re thinking. You’re asking me to feel sympathy for Audi-driving, Chase Sapphire-loving, Whole Foods-shopping consultant types with kids in private school?

Well…not exactly. But what they’re feeling is a version of what a lot of Americans at every income level face—making more money but not feeling like there’s a surplus. The essence of being a HENRY is feeling a gap between what you have and what you think you need to be comfortable.

What these high earners consider essentials might be termed luxuries (or nonsense) by the rest of us, but it’s also true that it takes more money to feel rich these days. And their great fear is becoming a HENRE: high earner, not rich ever.

The outlays for housing, private schools, transportation, and health care, not to mention education indebtedness, are often underestimated by 20- or 30-year-olds who think they have made it with a $200,000+ starting salary.

Even HENRYs whose futures look bright can't relax, since the loss of their high-paying job could be disastrous.

Speaking from the experience of being a previous generation's HENRY, I had visions of being able to quit when I was 40 but didn't achieve that psychological comfort zone until I was in my mid-60's. Hard work and technical abilities, while necessary, were IMHO not as important as finding a trustworthy life time partner and keeping one's health. (Having a little luck helps, too.)

The Laughing Heir

(For sale on Amazon): But will your cat take care of you?

We are personally acquainted with Bay Area millionaires who are over-60, never been married, and never had children. (They are millionaires primarily because of the houses they bought over 25 years ago.)

The recent growth in this demographic has resulted in the phenomenon of the laughing heir: [bold added]

Charities, distant relatives and even pets are benefiting from surprise inheritances. They can thank people without children.

Not having children is becoming more common, both among millennials and older people. A July Pew Research Center analysis found that 20% of U.S. adults age 50 and older hadn’t had children.

And many of these people don’t have wills. An AARP survey found half of childless people age 50-plus who live alone have a will, compared with 57% of others that age. Those without wills have less control over what happens to their money, which often ends up in the hands of people who don’t expect it.

This phenomenon of a surprise inheritance is common enough that it has a name: the laughing heir.

“All they do is get the money and go, ‘Ah ha ha, look at that,’ ” said Michael Ettinger, an estate lawyer in New York.

Having a significant estate when a childless person dies may be the result of rational decision-making:

Financial advisers say a far bigger concern than who gets what is making sure there is enough money and support for a comfortable old age, because clients without children can’t call on them for help...

Choosing an estate executor and who would handle money and health decisions on your behalf can be difficult when you don’t have children, financial advisers say. Using a promised inheritance as a reward for taking care of you when you are older isn’t a good solution, said Jay Zigmont, an investment adviser focused on childless people.

“Unfortunately, it is relatively common to see family members who are in the will decide to opt for cheaper medical care (or similar decisions) in order to protect what they will be inheriting,” he said in an email.

The old-age safety net, which many still subscribe to, is to have children who will have your best interests at heart. (I've seen enough murder mysteries to know that this is not always the case!)

The second-best option appears to be letting your distant relatives know they will be remembered in the will for some assistance today. The risk, as mentioned above, is that the aforementioned relatives may prioritize keeping the size of the estate as large as possible at the expense of the elderly person's care. And, as they collect their inheritance, they'll be laughing all the way to the bank.

They're Different from You and Me

I thought I was fairly knowledgable about communication--both verbal and non-verbal--but a segment of the population does not speak a language with which I'm familiar.

How the Super-Rich Signal Their Wealth to Each Other [bold added]

‘The Asprey,’ a Patek Philippe perpetual calendar
chronograph, pictured before it sold at Sotheby’s
for $3.88 million in 2018. (WSJ/Balibouse photo)

gauche display is out. A subtler set of cues and signifiers is required.

The most straightforward symbols start with watches. One Wall Street macher explained, “You see a gold Rolex Daytona, that’s one thing. You see a Patek Perpetual and you say to yourself, OK, this guy’s playing a different game.”

...Pretending to play down your wealth while emblazoning your net worth in neon requires a lightness of touch. You can’t say it outright, but you want it crystal clear.

It’s extra tricky in Manhattan, where you can’t employ the usual clues of estates and automobiles. Here, people live in apartments many stories up from the sidewalk and out of view. They tend to interact at restaurants and galas, and they never drive.

So everything depends on attitude. You must act like big things in life are, well, no biggie. When you can wrangle people to your abode, serve a tub of Ossetra caviar with Lay’s potato chips. Place it out like guacamole on the coffee table.

Verbal cues confer insider status. High-rollers in the art world now refer to the most rarefied paintings as “pictures.” Thus, for a would-be bidder, a $40-million Abstract Expressionist canvas by Rothko is not a “masterpiece painting” but a “picture.” For most people, a picture is what your 4-year-old paints with a thick brush and primary colors for Mother’s Day.

...Of course, how you travel is essential. As a former Wall Street bank chairman told me, “OK, so you went to St. Barts. So what? That tells me nothing. How’d you get there? That is key.”

To telegraph that you flew private over commercial, those fluent in the language of wealth-speak have created new verbs. People say, “We NetJetted into Aspen. We just had to.” Pause. “Because of the dogs.” Transporting “the dogs” is somehow a constant justification for private travel.

Owning your own jet is a huge notch up on the totem pole. The effort to be blasé about your new Gulfstream G650 can be positively tortured. To signal that your NetJetting days are over, you might drop into conversation with a sigh, “We’ve got to find a new pilot.” This should be said in the same tone as a wearied parent complaining about needing a new babysitter.

Most of the top tenth of 1 percent worked hard to get to where they are. However, they can't clip coupons and relax. They must continue to work hard to signal where they are, discreetly, on the totem pole.

A Roman Tradition

Mark Zuckerberg commissioned a seven-foot sculpture of Priscilla Chan, 39, his wife of 12 years:

The statue, commissioned by Zuckerberg, was created by New York-based artist Daniel Arsham and placed next to a tree in what appears to be a lush garden.

...The statue’s design, with its flowing silver garment, looks like a mashup of ancient Roman Sculpture and the T-1000 from Terminator 2. According to Zuckerberg, the inspiration came from the former: he captioned the photo “bringing back the Roman tradition of making sculptures of your wife.”

Priscilla Chan

Having been married nearly half a century, I've run out of ideas for gifts (that I can afford) for my wife.

Mark Zuckerberg, currently worth about $185 billion, doesn't have my problem.

Those Vagabond Shoes

(WSJ Illustration)

The ex-New York-now-Florida uber-rich are back in NYC for the summer. Conversations with their wealthy friends who stayed behind are laced with one-upmanship (one-up-personship?):

It’s summertime, and wealthy New Yorkers who moved to Florida are back North. From East Hampton to Kennebunkport, everyone’s in the same sandbox now. It’s time to compare who has the shiniest bucket: those who decamped or those who stayed.

Palm Beach: the best decision ever? Yep, or so they claim. They golf before work and take a dip on Billionaires’ Row beachfront after work. It’s only two hours by speedboat to go bonefishing in the Bahamas.

But for true Manhattanites, moving somewhere for fishing ease seems positively boneheaded. Asked if he’d ditch New York for enduring sunshine, mega-developer Aby Rosen prefers the big-boy pond. “Wow, gee whiz, how great I’m so free, swimming with kids in the middle of a workweek,” he responded facetiously. “I mean, who does that? I don’t want to putz around. Midweek, I’d rather go to Carnegie Hall, Lincoln Center or hear good jazz downtown. Kill me if I have to jump on a boat on a Wednesday evening!”

F. Scott Fitzgerald said the rich "are different from you and me." Nothing distinguishes a person more than language, and what the rich talk about is very different from normal people, too.

"Take Nothing for Their Journey"

Today's reading from the Gospel of Mark, Chapter 6:

"He ordered them to take nothing for their journey except a staff; no bread, no bag, no money in their belts; but to wear sandals and not to put on two tunics."

The minister said that she took two lessons from Jesus' command to travel lightly: that we must have faith in a "radical dependence on God" and that we must be willing to "let go of our grip on those long-held practices and traditions that may not be helpful anymore."

Concerning the latter, she clarified that she doesn't mean that we must throw out the liturgy and all our traditions, but that we must be open to listen to the Spirit's voice if it tells us to change.

At this stage in my life, it's the former lesson, to leave our possessions behind, that speaks most loudly. All the financial security in the world can delay one's fate but not prevent it. In the end our accomplishments, our wealth, and any pride we might have in them mean little except more material for the obituary.

Later in Mark, Chapter 10, Jesus is more specific (my own reflection and not part of the minister's sermon): [bold added]

17 And when He had gone forth onto the road, there came one running, and knelt before Him and asked Him, “Good Master, what shall I do that I may inherit eternal life?”

18 And Jesus said unto him, “Why callest thou Me good? There is none good but One, that is, God.

19 Thou knowest the commandments: ‘Do not commit adultery, do not kill, do not steal, do not bear false witness, defraud not, honor thy father and mother.’”

20 And he answered and said unto Him, “Master, all these have I observed from my youth.”

21 Then Jesus, beholding him, loved him and said unto him, “One thing thou lackest: Go thy way, sell whatsoever thou hast and give to the poor, and thou shalt have treasure in Heaven; and come, take up the cross, and follow Me.”

22 And he was sad at that saying and went away grieved, for he had great possessions.

I am and have been that young man, unwilling to take that final step and leave all behind. Sure, there are justifications that few will quarrel with--I have to take care of my family, I don't want to be a burden to others, etc.

But it's also true that what we thought of as a choice--to take nothing for the journey--was never in the end really a choice at all.

Loud Budgeting

I missed this new term in personal finance: loud budgeting.

Lukas Battle (Instagram)

Loud budgeting began as a joke, said Lukas Battle, the 26-year-old comedian who coined the term in a December TikTok video after a night of overspending.

When Battle’s friends then messaged him asking to go out to an expensive Italian restaurant in Manhattan’s East Village neighborhood, he proposed they all cook dinner at someone’s house and have a game night instead. It was a riff on “quiet luxury,” the trend of favoring well-made, expensive, but understated fashions.

Battle’s video took off, generating over one million views and more than a thousand comments. Hundreds of people have shared their own examples of how loud budgeting helped them save money.

“People want a break or some sort of relief from this constant need to be spending and buying,” said Battle, who lives in New York.

Loud budgeting has helped some combat the peer pressure to spend.

Madeleine Burke (WSJ)

Madeleine Burke, 26, said her best friend visits the nail salon every two weeks for a manicure and pedicure. The last time Burke went with her, she paid $45 for a pedicure and instantly regretted the decision.

“I cannot believe I paid for that and I could’ve done it at home,” said Burke, who lives in New Orleans. The next time she was asked, she felt more comfortable declining. She credits loud budgeting with helping change how she approaches spending.

Burke said her friends now host more potlucks at each other’s homes and go secondhand shopping together.

Your humble blogger admits that during his career he yielded to social pressure by going on expensive outings that he didn't want and couldn't afford--or, to be more accurate, could pay for if he defunded activities that had a higher priority (e.g., retirement savings, replacing a 15-year-old car).

If proclaiming publicly that you don't have the dough gets your non-wealthy status out in the open, that's a welcome improvement over "my spouse and I have other plans" or "we can't find a babysitter." Any friends you may lose aren't really your long-term friends anyway.

Not a Sinister But a Hopeful Sign

(WSJ map)

Seven weeks ago we posted our take on the mysterious Flannery Associates that had bought 52,000 acres near Travis Air Force Base.

Personally, I think that the land purchases have been too extensive ($800 million) to be for a [Chinese] spying operation. More likely the ultimate goal is development; residential costs in Vacaville and Fairfield are all much lower than in the San Francisco Bay Area and expansion near there makes sense.

It also wouldn't be surprising if the buyer was a tech giant which has long-range plans to build a "company town" complete with offices, manufacturing, and houses. Far from being a concern, proximity to Travis AFB would be a plus if the hypothetical tech has aerospace elements.

My predictions were close to the mark.

Tech Leaders Emerge Behind Plan to Build New City Near California Air Base

A group of high-profile Silicon Valley entrepreneurs and investors emerged Friday as backers of a group that plans to build a new city in Northern California, after its purchases of land around an Air Force base had raised national-security concerns among U.S. officials.

Flannery Associates said Friday it planned to construct a new housing development in the area...

The group’s investors include a high-wattage list of technology entrepreneurs and investors, according to a person familiar with the group. They include LinkedIn co-founder Reid Hoffman; former Sequoia Capital partner Michael Moritz; and venture capitalists Marc Andreessen and Chris Dixon, who are general partners at Andreessen Horowitz.

Other investors include Patrick Collison and John Collison, co-founders of Stripe, a payments processor to internet companies; Laurene Powell Jobs, a philanthropist and the widow of Apple co-founder Steve Jobs; and Nat Friedman, the former chief executive officer of GitHub.

The $1 billion spent so far is small potatoes compared to the combined net worths of the billionaires named as purchasers. That said, it will take multi-billions more, plus a time horizon of at least two decades to see just the initial returns from this project.

We will likely find that the investment is being made by trusts for the benefit of the billionaires' children and grandchildren, with the development profits escaping estate taxes.

Additional comment: California is not totally lost if some extremely wealthy people still regard California as a place to make money from very long-term investments.

The Zen of Gray Concrete Blocks

Brutalist example: the FBI building

We've commented on the brutalist style in architecture before. (As with many cultural topics, it became politicized when President Trump disliked brutalism to the extent that he issued an executive order banning the style from future Federal projects. President Biden revoked the order.)

In general our tastes don't run in the direction of gray concrete blocks, but we do find some of the structures, such as UCSD's Geisel Library, esthetically pleasing.

Kanye's $57MM Malibu home (WSJ)

The latest trend by ultra-wealthy home buyers is to have their home designed by 81-year-old Tadao Ando, whose technique some have likened to Brutalism:

Celebrities like Beyoncé, Jay-Z, Kanye West and Kim Kardashian are flocking to homes designed by Tadao Ando, a self-taught, Osaka-based architect. Ando’s homes aren’t just rare, but also affordable only for the very rich: Numbering fewer than 20 in the U.S., they are generally defined by their use of reinforced architectural concrete, which makes construction far more expensive than in typical homes...

Tadao Ando (WSJ)

Born in Osaka in 1941, Ando had a brief stint as a boxer before turning to architecture. Largely self-taught, he opened his eponymous firm in 1969, according to the firm’s website. While early works included tiny homes in Japan, Ando became famous for cultural institutions like the Church of the Light in Osaka, which opened in 1989, and the Pulitzer Arts Foundation in St. Louis, which opened in 2001. He won the Pritzker Prize in 1995...

Sometimes described as Brutalist, Ando’s homes are typically hulking, sparse structures with smooth edges, water features and windows that frame the views. Admirers say they evoke an almost spiritual, Zen-like experience in their simplicity, while others say the concrete is too hard and cold to be livable.

This Ando Santa Fe home sold for $40MM (WSJ)

Tadao Ando's method isn't for everyone, but those who like it really, really love it. Concrete is difficult and expensive to work with, but billionaires and centi-millionaires don't care that his works cost "two to three times more than traditional high-end home construction."

And at his stage in life the architect doesn't seem to care about money either.

“a billionaire could come in the door tomorrow and offer him a billion dollars to design his house, and that wouldn’t motivate him,” said L.A. real-estate agent and developer Tyrone McKillen, who has worked with Ando. “It has to be close to his heart for him to work with you.”

"Be the House"

(NY Post image)

One common characteristic of getting older is that people become more conservative--politically, culturally, and financially. As life's expiration date approaches, this perspective makes sense.

Older people, including your humble blogger, are less willing to take chances because they have more to protect. If a risky bet turns out wrong, recovery--physical and financial--is difficult and sometimes impossible.

That's why Elon Musk is unique. At 51, his enterprises and his wealth are an order of magnitude bigger than they were ten years ago, yet he's still willing to bet the farm to fulfill his vision(s):

In the span of 24 hours this past week, Elon Musk made three very big bets with three very different companies, together showing his penchant to plow ahead despite sizable risks.

Between Wednesday and Thursday evenings, he stripped celebrities, journalists and other high-profile users of their free, legacy verification on Twitter, risking a VIP revolt on the social-media platform. He promised that the electric-car maker Tesla Inc. increase; green up pointing triangle would chase sales volume at the expense of profitability. And he launched SpaceX’s first of its kind giant space rocket, which exploded on the way to the heavens.

Making big bets doesn't mean that Elon Musk isn't aware of the risks:

“If the odds are probably in your favor, you should make as many decisions as possible within the bounds of what is executable,” Mr. Musk said a few years ago. “This is like being the house in Vegas. Probability is the most powerful force in the universe, which is why the house always wins. Be the house.”

Although he's one of the richest people in the world, amassing wealth was not the goal, just a means to get to his destination. Elon Musk's aspirations are grand indeed: interplanetary space travel, efficient autonomous transportation, and a platform for the free-wheeling exchange of ideas.

Along the way Elon Musk doesn't care how foolish he looks to others. Blowing up a rocketship to find out whether it functions (without hurting anybody) is a necessary step on the way to Mars, and crashing cars is the price for making millions of authomobiles self-driving.

Wealth often induces billionaires to become philanthropists and lift individuals out of poverty. Elon Musk's way of using his wealth, IMHO, will enrich humanity's future.

Too Much Too Soon

(WSJ illustration)

Polls have consistently shown that the principal subjects that married couples fight about are money, chores/responsibilities, sex/infidelity, and power/control.

Often money is listed as problem area number one, because the lack of money can be the source of enormous stress. It now turns out that large gains in wealth can also foment discord, especially if the gains occur over a short period of time,

Both gaining and losing money upends partners’ understanding of shared values, beliefs or assigned roles within the relationship. When couples cannot adjust to their new financial standing and fail to communicate their concerns or desires, the marriage may be in trouble, said researchers and relationships counselors...

Researchers [David] Cesarini and Anastasia Terskaya tracked lottery winners in Sweden for 10 years after they hit the jackpot. In a working paper published in March, their team found something surprising: who held the winning ticket significantly changed what happened to the marriage.

In the long-run, male winners saw reduced divorce risk and higher fertility, leading to stable marriages and family formation. When a woman held the winning ticket, the windfall of around $100,000 and $500,000 increased the likelihood of divorce, especially for low-income women and those who earned far less than their husbands.

There are additional strains because the sudden acquisition of wealth (e.g., lottery winnings, professional sports contracts) is often accompanied by fame. It's exceedingly difficult to work through relationship problems under the glare of publicity.

All things being equal, building one's wealth slowly allows the partners time to adjust their relationship, as well as avoid the risks of having friends, relatives, and even the general public know their business.