It seems so long ago. But in 2009, many of the wealthy were stunned to find themselves in a cash crunch. Despite all the talk of cash cushions and risk management, many of the wealthy suddenly realized that they had overborrowed, overspent and overconcentrated on a single asset or industry.
We had suddenly entered the new age of the High-Beta Rich, where the wealth was volatile and far more cash was needed to absorb the shocks of financial markets.
Four years later, the lesson still holds.
A study from Spectrem Group asked wealthy and affluent investors “what do you wish you had done differently in the crisis.”
For the top earners—those making $750,000 or more—the No. 1 answer was “saved more.” Ranked second was “done more research about finances on my own” and then “not taken on as much debt.”
Their regrets have turned into real action—with possible impacts on the broader economy. Since the financial crisis, the wealthy have become the nation’s top cash hoarders, filling up deposit accounts and money markets at a rapid clip.
According to research from American Express Publishing and Harrison Group, the savings rate of the wealthiest 1 percent soared to 37 percent in the second quarter. That’s up from 34 percent in the second quarter of 2012—and more than three times their savings rate in 2007.
A separate study from Bank of America recently found that 56 percent of millionaires have a “substantial” amount of cash. Only 16 percent of them plan to invest that cash in the next couple of months. And only 40 percent plan to invest it over the next two years.
Some say that cash is money that could be invested in companies, spent on consumer goods or put into job-creating enterprises. Still, stock markets and other financial assets are near all-time highs even with all that cash on the sidelines. And the spending by the wealthy remains fairly strong by most measures.
How stupid do you have to be to cut in line in front of a bunch of people who are almost certainly armed and so completely sold on the idea of an imminent ban that they will stand out in the cold for a chance at a handful of newly arrived bullets ? Gander applies a purchase limit, of course, lest the first person in line buy the whole stock, thereby precipitating a riot.
Lubbock police officers arrested a man after he pulled a gun on someone in front of local store Friday morning.
Ernesto Vasquez, 52, along with several other people, waited outside Gander Mountains for the store to open. A dispute over place in line caused the situation to escalate to a weapon being shown, said Sgt. Jonathan Stewart, a police department spokesman.
Vasquez showed the gun and began to threaten someone in line, police said.
More: Man Arrested for Pulling Gun in Line
These lines form outside every large ammo retailer when word spreads that the store has received a new shipment. The panic-crazed mob then cleans out the newly arrived inventory in a matter of minutes. My brother says he has seen the same thing in Colorado Springs and guns have been drawn there, too.
Reality TV has brought national attention to hoarding, and now a recent change in the influential psychiatric diagnosis guide may actually bring help for millions of Americans suffering from the isolating condition.
Hoarding - a psychological condition that can result in homes crammed floor to ceiling with papers, junk mail, books, clothing and other “valuables”— has been associated with obsessive-compulsive behavior, although experts have long held that the two disorders aren’t necessarily connected.
In the revised, fifth edition of the American Psychiatric Association’s Diagnostic and Statistical Manual of Mental Disorders (DSM-5), “hoarding disorder” becomes a separate diagnosis, characterized by a “persistent difficulty discarding or parting with possessions, regardless of their actual value.”
The revised diagnosis should “result in more people having access to treatment,” says Randy Frost, a professor of psychology at Smith College who specializes in hoarding issues. “Right now, there are very few clinicians who know how to treat it. Once it shows up in DSM, there will be much more pressure on clinicians to train in how to treat this problem.”
Hoarding isn’t just a messy garage or packed closet. According to the APA, it’s defined by its harmful effects — emotional, physical, social, financial and even legal — both on the hoarder and the hoarder’s family members.
So, Obama’s second term hasn’t even started and he’s already improved the business climate for at least one major industry.
The gun manufacturers and importers should enjoy it while they can. No, Obama isn’t going to shut them down, something worse is going to happen to them: Come 2017, we will have about a 100 year supply of barely used guns on the second hand market and new ones won’t be able to compete with the bargains available.
Black Friday gun sales highest ever despite system glitch, FBI spokesman says
GRAY, Maine, Nov 27, 2012 (Bangor Daily News - McClatchy-Tribune Information Services via COMTEX) — So many gun dealers called the FBI’s National Instant Criminal Background Check System, or NICS, on Black Friday that the system went down twice and was slowed for those who did get through, Maine gun dealers said Monday.
Even with the glitches, a record number of guns were sold on Black Friday all across the country, Stephen G. Fischer Jr., director of the FBI’s Criminal Justice Information Services Division, said Monday.
“We had an awful time getting through all day, and sometimes we couldn’t get through,” Adam Copp, president of Howell’s Guns & Archery Center in Gray, said Monday. “I don’t know what the problem was. They set a record last Black Friday, so I figured it had something to do with that.” Those who want to purchase a gun in the U.S. must fill out and sign FBI paperwork. The gun dealer then calls NICS to see if the buyer is barred by federal law from possessing firearms.
“We had people waiting and some said, ‘I can’t wait all day,’ and left,” Copp said. “We may have lost of couple of sales, but we got everything through by Saturday morning. It was the busiest day we’ve had all fall.” The West Gray Road store sold more than 15 guns, he said.
Customers at Van Raymond Outfitters in Brewer also had to wait on Black Friday. The store lost half a dozen customers because the system was down or the wait was too long, manager Rick Lozier said Monday.
“Sometimes it would take 10 minutes to get though and sometimes it was 20,” the longtime Brewer store manager said. “It was pretty much all day long. We still had a good day considering the holdups.” Those who left emptyhanded did so “from frustration from waiting,” Lozier said. “Overall, we’re not a patient society.” The NICS outages that occurred on Black Friday were due to exceptionally high call volumes, Fischer said.
But Obama’s coming for our guns! It’s just a ploy till after the election! Stock up, but wait till I buy some more stock in Olin Corporation.
The White House gave a cool welcome on Monday to Democratic legislation that would effectively ban online or mail-order purchases of ammunition in the aftermath of the mass shooting at an Aurora, Colorado, movie theater.
“I haven’t seen the specific piece of legislation that has been offered up today,” spokesman Josh Earnest told reporters at the daily press briefing. “But as that and other pieces of legislation make their way through the legislative process, we’ll evaluate them.”
The proposal, crafted by Democratic Senator Frank Lautenberg and Democratic Representative Carolyn McCarthy, aims to restrict the ability of Americans to buy unlimited quantities of ammunition over the Internet, or by mail order, anonymously.
President Barack Obama has called for a common sense response to the slaughter in Aurora. But the White House has played down his appetite for new legislation as opposed to tightening or toughening existing measures—such as background checks—to keep firearms out of the hands of criminals or the mentally ill. And the president has underlined his support for the Second Amendment to the Constitution.
“He believes in the second amendment of the constitution, in the right to bear arms,” Earnest said again Monday. “But he also believes that we should take robust steps, within existing law, to ensure that guns don’t fall in the hands of criminals or others who shouldn’t have them.
The new legislation, dubbed the Stop Online Ammunition Sales Act, rests on four pillars, according to Lautenberg’s office:
It requires anyone selling ammunition to be a licensed dealer.
It requires ammunition buyers who are not licensed dealers to present photo identification at the time of purchase, effectively banning the online or mail order purchase of ammo by regular civilians.
It requires licensed ammunition dealers to maintain records of the sale of ammunition.
It requires licensed ammunition dealers to report the sale of more than 1,000 rounds of ammunition to an unlicensed person within any five consecutive business days.