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Tags: hyman | blog | millionaires

How 153,000 Millionaires Disappeared in Two Years

By    |   Sunday, 17 June 2012 12:35 PM EDT

You’ve heard me say that inflation is the “great divider” of the classes. You’ve also heard me mention why I started the Ultimate Wealth Report: to help investors position themselves to benefit from rising inflation rather than having their wealth eroded by it.

We, the numbers are out from the IRS. In 2007, there were 390,000 tax filers that made $1 million or more. Just two short years later, there were only 237,000 of them.

That means 153,000 of them (39 percent) fell out of that level within just two years! It could be said another way:  Almost four out of 10 millionaires disappeared within two years.

Editor's Note: Join the 3.5% of Americans who are truly wealthy and financially secure.

The deca-millionaires got hit even worse. In 2007, there were 18,394 tax filers that made $10 million or more that year. But in 2009, it dropped to 8,274, which is a 55 percent drop!

OK, but what about the category of those that made $200,000 to just shy of $1 million? 

There were 4,536,000 tax filers in this category in 2007. In 2009, it dropped to 3,924,000. So 612,000 dropped out of this category, too!

(By the way, this category represents less than 3 percent of the tax filers, yet these tax filers pay 50.1 percent of the taxes.)

That means the top 3 percent of tax filers paid more than the entire bottom 97 percent! So I guess you can see why I don’t buy into Occupy Wall Street’s one-percenter stuff. 

So the big question is, how did all of these people lose their wealth? Inflation! The rising and then popping of asset bubbles robbed them of wealth and also brought about a sluggish economy that has since caused a “death by a thousand cuts” type of situation on these tax filers.

But it’s not just the high-income folks that got hit on the chin during this time.  I just wanted to show you that no one is safe from the enemy of inflation, not even the rich.

This affects “middle America,” too, that makes around $30,000-$80,000 a year. So no one is immune.

But I’ve got my Ultimate Wealth Report subscribers positioned to profit and “dodge the bullet” of rising inflation. In fact, we’re riding the wave that inflation creates. Right now, our portfolio is up 8 percent in roughly 60 days. So while costs are rising all over the place, my subscribers are fending off the effects of those rising costs by our rising portfolio that benefits from rising inflation.

So whether you remain in the middle class or upper class or not depends upon how you have your portfolio positioned. Are you positioned to benefit from inflation’s rise? I’d dare say that most investors are not prepared for the rise of inflation.

Editor's Note: Join the 3.5% of Americans who are truly wealthy and financially secure.

They’re into stocks that get hindered by inflation’s rise. But we’re in commodity-related stocks that actually go up as commodity costs rise and stoke inflation. We’re also going to have some foreign currency-related stocks and ETFs in our portfolio. These are the stocks and ETFs that gain an edge from a falling dollar and a rise in foreign currencies.

So we’re positioned well for the next round of “money printing” from the Fed, much like a surfer that’s positioned for that next “great wave.” So instead of Fed policy makers depleting our wealth as they turn on the printing presses to attempt to dig our economy out of a hole, they’re actually going to fan the flame for our portfolio as our stocks benefit from their tactics.

Make sure your portfolio is ready for the next round of Fed-tampering like we are.

About the Author: Sean Hyman
Sean Hyman is a member of the Moneynews Financial Brain Trust. Click Here to read more of his articles. He is also the editor of Ultimate Wealth Report. Discover more by Clicking Here Now.

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Sunday, 17 June 2012 12:35 PM
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