Rich Boomer, Poor Boomer

If there is one thing worse than a Baby Boomer, it's a rich Baby Boomer.  Since the Boomers have become adults and took over the business world, the middle class has shrunk considerably.  According to Bruce Judson, a Senior Faculty Fellow at the Yale School of Management, “In 2007, the percent of total income received by the top 10% of families was 49.74%, or effectively one-half of the nation’s total. This compares to 1980, when the top 10% received 34.63%, or about one-third of all income.”

Another even more disturbing statistic compiled by Judson states that "the top 5% of households grew from $134,800 in 1980 to $220,100 in 2007; an increase of 63%. In contrast, over this 27 year period, the average real household income of the bottom 90% of families increased from $29,800 to $32,400; less than 9%.  The real income among the top 5% grew at seven times the rate of income of the bottom 90% (63% as compared to less than 9%), an extraordinary difference of 600%."

These numbers should surprise no one who studies the Baby Boom generation.  Self absorption and high self worth lead to selfish behavior.  For the same reasons the rich Boomers used their connections and college deferments to get out of serving in Vietnam, they, in their middle life, continued to look out for number one. 

In an April, 2010 poll, the New York Times discovered that the recent Tea Party movement was made up of mostly wealthy and educated Baby Boomers.  While it appears that Tea Party members reside in rural areas, the reality is that the movement is more about rich Boomers being afraid of a President who may increase their taxes and take some of their precious money away. 

As the rich Boomers in the Tea Party movement scream that President Obama is a socialist, what they are really saying is that they are not going to spend one dime of their money to benefit the greater good of the country. 

Didn't the Boomers' civic oriented parents teach their kids anything about duty and service?

$10,000 Pyramid Scheme

When the $10,000 Pyramid debuted on March 26, 1973, who knew the affect a game show could have on a whole generation.  As Boomer college students were getting high and watching the $10,000 Pyramid, some of the more greedy and ambitious ones realized that someday, when they were in business, they may use the concept of the pyramid and take advantageous of their fellow comrades.

Well, their time came in the mid 1990's.  As Boomers were consuming more material goods and living for today, many of them realized that they were now in their fifties and it was time to start thinking about retirement.  The problem, for most Boomers, was that they did not save a dime in their adult life.  According to the Employee Benefit Research Institute, the personal savings rate in the United States saw a consistent decline from the early 1980's.  While the personal savings rate was over 10% in the late 1970's, by the mid 1990's the rate had declined to around 5%.  In the 2000's, the personal savings rate actually declined so far that by 2005, it dipped below zero.

So, with no savings and retirement just around the corner, the Boomers were ripe for get rich pyramid schemes.  And in the last twenty years, there were many.  One of the largest was the Dotcom bubble of the 1990's.  The greedy Boomer bastards on Wall Street colluded to convince a financially incompetent generation that the traditional metrics to measure stock value were antiquated and investment in Internet based companies led to quick riches.

Some of the more hilarious stories from the Dotcom bubble include:

• Pets.com - According to Wikipedia. Pets.com spent 11 million on advertising when they only made $619,000 in 1999.  I just can't figure out why their stock went from a high of $11 to a low of $0.19.
• eToys - They raised 166 million in venture capital with a business model that had them buy retail and sell retail.  Strangely enough, the stock went from a high of $84 to a low of $0.09. 
• Webvan - With traditional grocery stores having razor thin margins, it seems logical that an online grocery with very high fulfillment costs would be a great idea. Suckering inept and desperate Boomers for quick riches, the stock hit $30 and of course, the stock became worthless since groceries are barely profitable.

While some individuals that started the Dotcom pyramid scheme made out like kings, just about all the suckers that invested in Internet-based stocks lost a ton of money.  As the new millennium began, the Boomers were really in trouble.  No savings and what little they had was lost in the Dotcom bubble.  But, no fear....here comes real estate...and that will be the ticket to a wealthy retirement....or something like that.