by Dr. Boyce Watkins
Warren Buffett is rich, very rich. This past year, Buffett’s wealth grew by a stunning $12.7 billion dollars, up to $59.1 billion. All of this according to Wealth-X, a firm that studies the nation’s super rich. This means that Buffett’s wealth grew by $1.5 million dollars per hour, every hour of the year and by about $37 million dollars per day.
The richest man in America is still Bill Gates, who has $72.6 billion in wealth. Most of the wealth gain came through the growth in the stock market. Even the guy who runs the Facebook page you sprint to every morning, Mark Zuckerberg, gained $10.5 billion dollars this year himself. He doesn’t use Facebook to find out what his friends are doing or to engage in long, meaningless conversations about stupid topics. Facebook is his personal ATM machine.
This is a lot of money. You don’t need a PhD in Finance to know this. But to put it all into deeper context, let’s do some quick comparisons.
LeBron James earned $60 million dollars last year, which means that Buffett earned James’ entire salary in less than two days. He earned this money without being able to dribble a basketball, or even being able to jump. In fact, LeBron would have to play basketball for nearly 1,000 years in order to match the wealth that Warren Buffett has right now. Wait, scratch that. He would have to play for 200 years just to earn the money that Buffett has earned this year alone.
For LeBron, his primary source of capital is his body. For Buffett, his source of capital consists mainly of a series of financial investments that work for him, like a bunch of employees in a factory. He earns more interest in two minutes than the average American worker earns for an entire year’s work. It may not be right, but it’s a FACT.
I am not here to engage in the glorification of the super-rich. America is a greedy country, to be honest, and the gap between the rich and the poor is going to be one of our great downfalls in the coming decades (Buffett also seems to agree, and does a good job of giving a lot of his money away). But the truth is that, should America fall under the weight of it’s own greed, most of us will either be old or dead by the time that happens. And even then, those who control wealth are going to hold all the cards.
The lesson to learn here as you engage in your own Financial Juneteenth is to understand the power and importance of capital ownership as a key to wealth. As black folks, many of us are taught to go to school and work hard so we can get a good job. But a job will rarely give you the kind of wealth and power necessary to transform a nation. If you want to become wealthy, you should focus on building capital: a series of financial investments that can go out and work for you when you are not lifting a finger. You can’t get ahead by renting yourself out to corporate America, that just doesn’t work.
That’s what we can learn from Warren Buffett. Don’t teach your kids to dribble basketballs. Teach them how to juggle good investments instead. The key to our liberation as a people is to learn to harness our wealth.
Dr. Boyce Watkins is a Finance PhD and the founder of the Your Black World Coalition and author of the book, “Black American Money”. To have Dr. Boyce commentary delivered to your email, please click here.