Carlos Slim debuted at the top of the list with $68.4 billion. However, in just one day he lost over $135 million. To most people this seems like an extraordinary amount of money. It should be pointed out however that the rich by definition have to take more risk than regular individuals. You can’t become a billionaire working a 9-5 job. I have no formal psychology training (other than the course I took in high and college) but I would be willing to bet that a large majority of people on the Forbes 400 list or now the Bloomberg Billionaire Index are workaholics. Being a billionaire is a side effect of being a workaholic. What is somewhat irritating is how people complain that people don’t need all this money. Of course, people would like to supersede the voluntarily decisions of millions of people who vote with their feet and their wallets. What seems to be more incredible is that even when people fall into “sudden wealth” they seem to mismanage it. One thing that comes to mind is lottery winners. Often you seem them blow through their money relatively quickly and ultimately file for bankruptcy. It seems as if the 99% when given extreme wealth ultimately end up back in the 99%. Perhaps the universe tends to unfold as it should. I don’t think I have ever heard of a lottery winner who then bolstered their wealth to new heights. Also a majority celebrities and athletes are notorious for blowing through their money.
One thing that is curious is how Bloomberg actually values the net worth of billionaires. Evaluating someone like Warren Buffett or Bill Gates is easy since most if not all of their net worth is in a publicly traded company. However, what about calculating the net worth of individuals that work for private companies? If you compare some of the numbers to Forbes they are different. For instance, Charles Koch on Bloomberg’s list is worth $34 billion yet last year he was worth $25 billion on Forbes. Of course Koch is CEO of Koch Industries which is privately held company. Bloomberg in evaluating the net worth of privately held companies looks at publicly held companies with similar values and price to earnings ratios. This is not a bad proxy but how does it lead Bloomberg and Forbes to be off billions in their evaluation of net worth?
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