Guest Post: What Is Wealth?

Tyler Durden's picture




 

Submitted by Charles Hugh Smith from Of Two Minds

What Is Wealth?

We all think we know what wealth is, but sometimes the "obvious" misses the mark.

Asking "what is wealth?" seems needless because we all know what wealth is: never having to work again, endless leisure, endless consumption of the "good things of life," being waited on hand and foot, luxurious belongings, vehicles and homes, a life of travel and sport, trust funds, stacks of secure gold, and so on.

All this is "obvious," but is that certainty illusory? There are many people with $2 million in net worth, a significant number with $20 million, and more than a few with $200 million. All would be considered wealthy by the average household earning $63,000 annually with a total net worth of less than $100,000, not to mention the 61 million American wage-earners who pull down less than $20,000 a year who own negligible net worth.

Those with a mere $2 million may not reckon themselves wealthy, if their eyes are fixed on those with $20 million. But if a wealthy person suddenly discovers they are riddled with fast-growing cancer, then they quickly lose interest in financial wealth except in terms of what medical treatment it can buy.

There really isn't much more modern medicine can do for someone worth $200 million than it can for someone worth $2 million; once one's life and health are at risk, then conceptions of "wealth" are drastically reordered: health is wealth, and nothing else matters.

Once lost, health is difficult to restore, and financial wealth is no longer the key metric. The graveyards are full of extremely wealthy people who died "before their time."

A life of leisure may not be all it's cracked up to be, either. Whether it is paid or not, work is the foundation of meaning and identity. Those without work become depressed, those who retire often fade and die, and those with no goals or work ethic become dilettantes who enrich various therapists and pyschiatrists with their ailments and unhappinesses.

It's not just leisure that's wealth, it's control of one's work life.

We might also ask if wealth correlates all that closely with happiness. Judging by the hordes of wealthy people who are drugged-out, alcoholic, and in permanent therapy, we can surmise the correlation is not quite as strong as the "financial wealth is everything" PR would have it.

Who is happier, the "natives" serving the supine, isolated wealthy person, or the wealthy person? It turns out it's the people who have a well-earned place in a caring community who are healthier and happier than those who are unloved and isolated, regardless of their wealth and power.

If our labor is compensated in fiat currency that can be depreciated by official whim, then how much of our labor do we actually "own"? Frequent contributor Harun I. has asked this question here, and the line of inquiry it raises applies to all financial wealth held in currency.

Precious metals, long a favorite of those seeking timeless wealth, also have their own pitfalls. Being small in size and easily transportable, they are also easily stolen or confiscated by authorities. A few coins sewed into garments to be used to bribe border guards are an extremely useful form of wealth, but any large cache of precious metals attracts criminals and Central State authorities, i.e. higher-order crooks. Wealth that can be stolen or confiscated has a nasty habit of being stolen or confiscated.

What about real property? An expansive estate is certainly "wealth" if it generates income, but if it happens to classify you as an aristocrat in revolutionary times, then various unpleasantries typically follow, and the wealth that seemed so desireable is transformed into a death warrant.

Wealth is not as fixed as we might imagine; it only appears solid in eras of stability. In times of instability and transformation, wealth that appears solid can evaporate in crisis or crumble in devolution.

Health, skillsets, work you control and a caring community are peculiar "assets" in that they cannot be confiscated by others for their own use. They are uniquely bound to individuals and relationships in a way that financial wealth is not: financial wealth can always be separated from the individual, but the individuals' skills, community and relationships cannot be confiscated.

If financial wealth can't buy health or happiness, then what can it buy? Perhaps all it really buys is an illusion of security and happiness that turns to dust once it is within grasp.

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Tue, 05/22/2012 - 10:33 | 2450877 EscapeKey
EscapeKey's picture

Am I missing something?

Wealth = purchasing power.

Life quality or happiness isn't wealth.

Tue, 05/22/2012 - 10:36 | 2450896 Cognitive Dissonance
Cognitive Dissonance's picture

"Am I missing something?"

Some perspective perhaps.

"Life quality or happiness isn't wealth."

Until suddenly it is.

Tue, 05/22/2012 - 10:40 | 2450930 EscapeKey
EscapeKey's picture

Life quality is a different quantitative measure to wealth. Wealth will probably improve your life quality, but the reverse is far from certain.

Tue, 05/22/2012 - 10:42 | 2450939 CharlieSDT
CharlieSDT's picture

Your health is absolutely the most important thing in your life.  Without it, not much else really matters.  It’s very hard to be happy if you’re not healthy.  Look at all the billionaire Arab sheiks flying to the Mayo Clinic for treatment.  Their money isn’t worth anything to them when they die of lung cancer or are bedridden with heart disease or diabetes for 20 years.  Getting your health under control is an essential life project.  Start today.

 

http://www.singledudetravel.com/2011/02/your-health-is-your-most-importa...

Tue, 05/22/2012 - 10:46 | 2450956 EscapeKey
EscapeKey's picture

That's not my point.

http://dictionary.reference.com/browse/wealth

 

wealth

noun
1.
a great quantity or store of money, valuable possessions,property, or other riches: the wealth of a city. 2.
an abundance or profusion of anything; plentiful amount: awealth of imagery. 3.
Economics .
a.
all things that have a monetary or exchange value. b.
anything that has utility and is capable of beingappropriated or exchanged. 4.
rich or valuable contents or produce: the wealth of the soil. 5.
the state of being rich; prosperity; affluence: persons ofwealth and standing.

 

http://en.wikipedia.org/wiki/Wealth

Wealth is the abundance of valuable resources or material possessions. The word wealth is derived from the old English weal, which is from an Indo-European word stem.[1] An individual, community, region or country that possesses an abundance of such possessions or resources is known as wealthy.

 

Health and wealth are not the same thing.

Tue, 05/22/2012 - 10:50 | 2450976 Cognitive Dissonance
Cognitive Dissonance's picture

The author is not saying that health and wealth are the same thing. He is saying that wealth (from a much broader perspective) is so much more than just financial.

In fact, under certain conditions wealth cannot be measured in financial terms.

Tue, 05/22/2012 - 11:11 | 2451050 Dr. Engali
Dr. Engali's picture

Wealth is what you put value on. What is defined as wealth to some people has no meaning to others. Some people find value in fiat but you try trading that fiat with somebody who trades in sea shells and they will look at you like you are nuts.

Tue, 05/22/2012 - 11:32 | 2451119 Manthong
Manthong's picture

If you are reading this , you live more comfortably and are likely wealthier than seven 9’s or more of all humans that have ever lived.

Tue, 05/22/2012 - 11:37 | 2451139 hedgeless_horseman
hedgeless_horseman's picture

 

 

Wealth is what an ugly man has, if he is married to a beautiful woman.

Tue, 05/22/2012 - 12:08 | 2451281 francis_sawyer
francis_sawyer's picture

@hh

put a couple of more fotos of your breakfast & dinner offerings... Those are good examples of wealth...

Tue, 05/22/2012 - 12:40 | 2451412 What does it al...
What does it all mean's picture

Most random Zerohedge post so far in 2012...

Many people smarter than me have tried to sort out happiness, wealth, good and evil.  

I am not going to add anything in this discussion, except to point out how hard it is.

Tue, 05/22/2012 - 12:23 | 2451337 Miffed Microbio...
Miffed Microbiologist's picture

Very true. Yet if he were to lose said wealth the beautiful woman exits quickly on the arm of a new man of wealth. Thus those men of wealth must feel a lot of pressure to maintain such a life style. I don't envy them and prefer my relative " poverty" but to each his own!

Miffed:-)

Tue, 05/22/2012 - 18:39 | 2453100 JeffB
JeffB's picture

Then too...

Beauty is in the eye of the beholder.

Or as Ben Franklin put it...

Beauty, like supreme dominion
Is but supported by opinion

Or David Hume...

"Beauty in things exists merely in the mind which contemplates them."

Many of the "beautiful women" society seems to put upon a pedestal hardly seem to be desirable wives from my vantage point.

True beauty will still be there in 20, 30, 40 years and more. Superficial beauty, not so much.

 

Wed, 05/23/2012 - 11:07 | 2454897 Deo vindice
Deo vindice's picture

I'd give you +100, but alas, ZH doesn't allow it.

Tue, 05/22/2012 - 11:33 | 2451121 Nothing To See Here
Nothing To See Here's picture

What good is wealth if not to buy/preserve quality of life? Wealth means nothing if it cannot be used towards those purposes.

Tue, 05/22/2012 - 11:52 | 2451207 Doña K
Doña K's picture

The author needs to consider wealth as part of a family unit, not only on an individual basis. Normal people get pleasure in helping family members, relatives and others in need directly. wealth should transcend one's life.

Tue, 05/22/2012 - 14:19 | 2451808 mind_imminst
mind_imminst's picture

Until recently $200 million could not buy health. Now it can.

www.longecity.org

Invest in the future. Help cure aging.

Tue, 05/22/2012 - 10:51 | 2450981 CharlieSDT
CharlieSDT's picture

IMO there are other kinds of weath.  How about spiritual wealth or the wealth of having close family or friends?  Or the wealth inside your head of tangible skill?  Don't just go to some dictionary, make your own definition.

Tue, 05/22/2012 - 11:03 | 2451021 Nobody For President
Nobody For President's picture

Unless you consider health a valuable resource...

The next paragraph of the Wikipedia article sez:

the meaning of wealth is context-dependent and there is no universally agreed upon definition.

 

So I define wealth as having 'enough' : money, health, community standing, good work, a balance between work and liesure - whatever is important to you. Individuals that always want 'more' will never be wealthy, no matter their net worth. 


Tue, 05/22/2012 - 11:48 | 2451201 tgatliff
tgatliff's picture

I think that Marx had the best definition of "wealth".  It is simply dead labor.  Meaning, wealth can purchase people's time, which is a modern day version of indentured servitude (aka voluntary slavery).   People need to eat, so they must sell their time to survive.  Someone who has enough wealth can graduate out of this situation.

Also, wealth cannot buy you happiness.  However, it can sure keep you content why you are looking for it.

Tue, 05/22/2012 - 10:45 | 2450952 tocointhephrase
tocointhephrase's picture

Tyler, you are quite spritual once all is said and done?

Tue, 05/22/2012 - 11:50 | 2451206 CPL
CPL's picture

Which Tyler?  There are many.

Tue, 05/22/2012 - 11:23 | 2451083 IMACOINNUT
IMACOINNUT's picture

Especially today having a healthy happy outlook and disposition is essential to finding and keeping a rewarding and fulfilling job. Employers are looking for those with attitudes that project success. That success usually leads to financial wealth or at least solvent net worth. 

And I have never known or heard of a happy healthy economist they are all greedy cutthroat bastards who will suffer in hell.

Tue, 05/22/2012 - 13:54 | 2451683 Darth..Putter
Darth..Putter's picture

It's not "He who dies with the most toys wins."  It's he who enjoys what he has wins.  Enjoyment is an internal experience.

Tue, 05/22/2012 - 10:41 | 2450932 AlaricBalth
AlaricBalth's picture

On a long enough timeline, we are all worm food.

Tue, 05/22/2012 - 10:57 | 2451005 kridkrid
kridkrid's picture

Not me... I'm a space monkey, ready to be shot into space.  Ready to sacrifice mysefl for the greater good.

Tue, 05/22/2012 - 11:51 | 2451211 CPL
CPL's picture

option c:  Meat.

Tue, 05/22/2012 - 10:43 | 2450945 mc_LDN
mc_LDN's picture

Isnt wealth ultimately all about the utility of time and the freedom to choose how that time is spent whether it be leisure, health, meaning, identity, power etc????

Tue, 05/22/2012 - 12:33 | 2451378 aerojet
aerojet's picture

What I don't get is all the people who are unbelievably wealthy who still work their asses off.  Why?  You can't buy more time in life.  Having all these belongings are nice and all, but if you don't have time for any of it, of what value is any of it?  I'm not saying "retire" because retiring is kind of a death sentence.  But why be so driven?

Tue, 05/22/2012 - 12:38 | 2451404 blunderdog
blunderdog's picture

An important step on the path to wisdom is to really deeply and intuitively understand that different people have different value-systems.

If you can never achieve *that* realization, you've got no chance of reaching any of the more abstract ones.

We're creatures who create our own "point," or fail to.

Tue, 05/22/2012 - 10:38 | 2450912 Toolshed
Toolshed's picture

The author has lumped physical wealth and spiritual wealth together into a single category. He also has made some serious assumptions about individual desires and motivations. A pretty poorly written article overall.

Tue, 05/22/2012 - 10:45 | 2450950 mc_LDN
mc_LDN's picture

Yes did seem like a bit of a fumbled q&a with readers. Not sure I got anything out of it.

Tue, 05/22/2012 - 10:41 | 2450935 battle axe
battle axe's picture

What is wealth? Simple, something I do not have. 

Tue, 05/22/2012 - 11:36 | 2451137 akak
akak's picture

Wealth: there's an ap for that!

Tue, 05/22/2012 - 10:51 | 2450971 Dr. Engali
Dr. Engali's picture

Give me good health,  in body and spirit,and good friends any day over purchasing power. That is how I define wealth.

Tue, 05/22/2012 - 10:59 | 2451010 kridkrid
kridkrid's picture

And the meek shall inherit the earth...

 

But not its mineral rights.

Tue, 05/22/2012 - 14:08 | 2451747 Karl von Bahnhof
Karl von Bahnhof's picture

Freedom=wealth

Tue, 05/22/2012 - 15:12 | 2452134 Cursive
Cursive's picture

@Karl van Bahnhof

How free is a billionaire suffering from late stage parkinson's disease?

Tue, 05/22/2012 - 11:15 | 2451061 Da55id
Da55id's picture

80 years is a breathtakingly short time. Literally. All the so called wealthy are approaching decrepitude and the thing that people TRULY fear...irrelevance

 

Mfoundation.org

Tue, 05/22/2012 - 11:39 | 2451151 geoffr
geoffr's picture

I think there has to be some consideration for things like my smartphone. In 1970, it would be considered a super computer.

We, as a whole, are much wealthier than we used to be. In many respects, at least. At the same time, we have a ton of debt.

Tue, 05/22/2012 - 10:33 | 2450888 The trend is yo...
The trend is your friend's picture

The philosophical answer.  Your Health is your Wealth. 

Tue, 05/22/2012 - 10:34 | 2450891 SHEEPFUKKER
SHEEPFUKKER's picture

Ask Steve Jobs about health and wealth.  But yeah, if many of us didn't need to slave for existence, then perhaps we could focus more on our health. 

Tue, 05/22/2012 - 11:20 | 2451076 Da55id
Da55id's picture

NewOrgan.org

Tue, 05/22/2012 - 10:38 | 2450892 Gief Gold Plox
Gief Gold Plox's picture

The only capital which is of permanent value is immaterial—the experience of generations and the development of science.
-- David Ames Wells

Than again, I'm a coin stacking barbarian. What do I know?

Tue, 05/22/2012 - 10:35 | 2450901 Chippewa Partners
Chippewa Partners's picture

I still say the single biggest component of net worth is good health.

The Cooper Clinic in Dallas rocks!!!!

 

Tue, 05/22/2012 - 10:38 | 2450909 bdc63
bdc63's picture

Sounds to me like Charles Hugh Smith just lost his shirt in the Facebook IPO ... well Charles, at least you have your health ...

Tue, 05/22/2012 - 10:38 | 2450913 Marginal Disutility
Marginal Disutility's picture

And then there is the question of "real" capital versus leverage and debt-based belongings, etc. Is a man with a huge McMansion and all the toys who is $2 million in debt more or less wealthy than an apartment-dweller with no debt and $100 K in the bank?

Tue, 05/22/2012 - 10:51 | 2450978 MsCreant
MsCreant's picture

I have a relative who thinks of me as poor because he has more stuff (but is in stupid debt). I have less stuff and my assets far out weigh my debt (which is almost gone). He works like an SOB and is constantly worried about making his monthlies. I am not. His attitude can be annoying, but he is young and his priorities include having the stuff that really, he almost cannot afford. 

I suggested he sell his house while it had value three years ago (no way). Now he is under water over $200,000. I suggested he default (no way). 

Not wealth.

Tue, 05/22/2012 - 11:01 | 2451018 kridkrid
kridkrid's picture

http://www.youtube.com/watch?v=1Y6kTsBNH78 - this video might connect with him... most likely won't, but you never know.

Tue, 05/22/2012 - 12:30 | 2451369 SilverDOG
SilverDOG's picture

MsCreant

 

... and what a good slave he is.

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