Rockefeller's adjusted fortune is not $300-$400 billion. It's a lot closer to $30 to $40 billion in fact.
That huge fake number - which has been thrown around the Web for more than a decade - is derived from the GDP share.
It goes like this. Rockefeller in 1915 (pick the year), was worth the equivalent of 1/37th of the US GDP. Therefore, adjusted to today, Rockefeller would be worth $bazillion (1/37th of $19 trillion; which used to be more like $12b-$14b when the fake premise originally started floating about).
If you dig into the calculation that was / is used on that $300-$400 billion, that's where it's coming from in every instance.
In fact, Gates is objectively far richer than Rockefeller ever was, just not in relation to the US economy size at present. Rockefeller was worth between $1 and $2 billion at his peak, in his time. The inflation adjustment on $1 from 1910 to now, is not 300x or 400x. It's closer to 20x to 30x. If it were 300x, Ford's famous $5 per day pay rate (from 1914), would be ... $1500 per day. Laughable obviously; the 300x+ doesn't pass any challenge thrown at it.
Yes, not in terms of buying power, but success in terms of proportion of GDP seems a reasonable measure. It must be harder to make the same amount of money in a smaller market. It also shows how well you did relative to others, and may be a better measure of how much actual power you have over others.
Just use the proportion 1/37 instead of converting to dollars, or I agree it's misleading.
Also: perhaps, $1500 per day today is reflective of our buying power in a way, if we consider new inventions like TV, smartphones, internet, air-travel, when the closest equivalents back then were much more expensive.
> Also: perhaps, $1500 per day today is reflective of our buying power in a way
(A little sarcastic, sorry:) Yes, if we ignore all of the things we buy that have gotten more expensive, it's like prices have deflated.</s>
Overall inflation measures a collection of consumer prices, the average of which has trended up since that time. It is a general reflection of buying power, dollar for dollar.
Of course you're right that the accepted measures of inflation would have already considered and addressed the issue. And I would guess that fundamentals like food and land/housing have indeed gotten more expensive.
I'm a little intrigued though: shouldn't technological progress and "accelerating returns" have made things cheaper? I do see for land, that location is a monopoly ("they aren't making any more" - at least, in that spot, in that community, with that access). I wonder how much similar market effects have "artificially" kept other prices high? An oligopoly or silent collusion/combination between sellers (e.g. as happened for flat TVs).
Also, I wonder if a different lifestyle is possible, leaning more heavily on those aspects that have gotten cheaper (one e.g. living remotely and working remotely or independently).
Anyway, I'm glad you agreed with my other points, I'm assuming.
> And I would guess that fundamentals like food and land/housing have indeed gotten more expensive.
>
> I'm a little intrigued though: shouldn't technological progress and "accelerating returns" have made things cheaper? I do see for land, that location is a monopoly ("they aren't making any more" - at least, in that spot, in that community, with that access).
Healthcare and education costs have increased hugely, housing costs moderately (moreso in the big cities). Overall inflation is somewhat offset by food and electronics getting much cheaper.
> I wonder how much similar market effects have "artificially" kept other prices high? An oligopoly or silent collusion/combination between sellers (e.g. as happened for flat TVs).
The healthcare marketplace is pretty terrible. Perverse incentives, no pricing transparency, etc is at least part of rapidly increasing costs. Oddly education has gotten much more expensive as well, including K-12, and there doesn't seem to be an obvious reason there.
> Also, I wonder if a different lifestyle is possible, leaning more heavily on those aspects that have gotten cheaper (one e.g. living remotely and working remotely or independently).
Yeah. If you can swing a remote tech job living in a low or moderate cost of living area, you can save enough to retire (in that LCOL location) in a couple years. It can really be single digit years if you can keep your saving rate above 90%.
Interesting, it's a bit different here in Australia, we have free healthcare, free education and incredibly high house prices (eg ordinary house in suburbs > $1 million; 2br unit almost $0.5 million). Of course, those first two aren't actually "free" and eg drug prices can be very high.
Patented drugs are at least something new - you're getting better tech, enhancing or even saving your life, to an extent previously impossible. The "standard" cost of drugs increases with our expectations, but also their true value. Inflation measures mightn't account for this. eg basics like aspirin and ibuprofen are dirt cheap these days.
House and education prices are above their actual utility; a bubble, an insidious monopoly, or something else.
Isn;t educatiin high because it's a false ticket to a "good job"? i.e. people get it for that reason (not for the education itself, or for a market demand for that specific skillset/knowledge), but the jobs aren't there, so they double down. Demand for education exceeds supply so the price goes up. Yes, more places are made available to meet demand, but they lack the prestige (and network effects) of the top institutions... On it goes. Mightn't apply to K12 though (that's highschool I guess?).
LCOL is it. BTW I used to want to retire, now I want to be able to work on projects. That's a subset, I guess.
Using Mr. Bezos as the example:
US$ 72,000,000,000
Annualized gain of, say, 10% on AMZN stock
Over a period of 27.6 years
1.1^27.6 * US$72,000,000,000 = ~US$ 1,000,000,000,000
Just in time for his 80th birthday.