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American billionaires are calling for higher taxes on top 1 percent to address growing income gap

Screen grab of income statistics taken from billionaire Ray Dalio’s paper titled “Why and How Capitalism Needs to be Reformed.”

Screen grab of income statistics taken from billionaire Ray Dalio’s paper titled “Why and How Capitalism Needs to be Reformed.”

Billionaires, boat dealers and bass fishing advocates are all expressing concern about the growing income disparity in the United States.

Warren Buffett, Jamie Dimon, Ray Dalio, Bill Gates and a growing list of others say that the current system is not sustainable, according to CNBC.

The inequality between rich and poor Americans is as high as it was in late 1930s, Dalio wrote in a paper posted last week.

The wealth of the top 1 percent of the population is now more than that of the bottom 90 percent of the population combined.

“In a nutshell, poor education, a poor culture (one that impedes people from operating effectively together), poor infrastructure, and too much debt cause bad economic results,” he wrote.

That feeling has been echoed in the marine industry lately as well.

Boat dealers’ 3- to 5-year outlook has hovered in neutral and negative territory in the past several Pulse surveys conducted by Baird in conjunction with the Marine Retailers Association of the Americas and Trade Only Today — reaching their lowest levels since the survey’s inception in 2014.

“Boating has now priced out the middle-class buyer,” said one respondent to the March survey. “Only the near rich/very rich can boat.”

“The price of new boats is pricing too many people out of the market,” wrote another. “These 5 percent to 7 percent price increases each and every year have to stop!”

Mark Jeffreys, host of popular bass tournament fishing webcast called Bass Talk Live, who is also a high school finance teacher, shares similar concerns.

“The big concern, in my opinion, is when is the bubble going to bust?” Jeffreys told Trade Only Today. “When are people going to get to the point where they’re not going to pay $9 for crank bait? When disposable income is decreasing and people realize their earnings are not increasing.”

What the industry has been able to do from a bass fishing perspective is stretch out payments, says Jeffreys.

“People are paying for their bass boat over a 10-year period,” says Jeffreys. “The amount of debt being incurred over last 10 to 15 years is astronomical. People are not saving, they are spending. It’s all being funneled through credit.”

“It’s very interesting and intriguing that boat companies have been able to do very well,” said Jeffreys. “They are generating a tremendous amount of revenue, but they’re not moving the units they did 15, 20 years ago.”

The wealthy are often writing checks for a purchase like a boat, and everyone else is stretching financing out into 120 payments. When the economy turns, those 10-year notes are no longer 8.5 percent, but 13 or 14 percent, said Jeffreys.

“What effect is all that going to have on companies?” 

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