Tough at the top

Compared to us mere mortals who are faced with the Consumer Price Index (CPI), an alternative index adjusted for the rich – the SALLI (Stonehage Affluent Luxury Living Index). It’s based on a basket of 50 items such as central London rental costs for a family property, private education, a day’s grouse shooting and fine wine and cigars and so on. And a new one is out now, and shows that things are getting tough at the top. The poor dears are facing a mighty 6% rise in the 12 months to April 2011, compared with our measly 4.5%. How will they get by?

This, apparently, “reinforces findings that UHNW [ultra-high net worth – i.e., obscenely rich] inflation is much more volatile than CPI, tending to exceed standard inflation in good times and significantly fall short in times of downturn”. Rents on ‘high-end’ London property rose by 6.7%. But apparently this trend is driven by higher demand, which is to say, the fact that rich people are actually queuing up even more than usual to rent London property – not exactly a problem of impoverishment, then. Consumables for the rich jumped 18% – fine wines rocketed up 27.6%, but fortunately champagne limited itself to a mere manageable 8%. Culture/entertainment were up an average of 10.3%, including a rise in art prices by 10.5%. But again the problem was high auction prices, so it really only shows that the rich still have plenty of money. They also cover ‘investments of passion’ – a wonderful phrase, betrayed by the fact that it refers to things like luxury cars, not, for example, the cost of paying their accountants extra to work how much tax they really owe and then paying it – rose a mere 4.7%. Yacht hire is up 5.1% on a year back, and sports and recreation as a whole up by 5.4% overall.

I don’t wish to seem ungrateful, but looking at some of the creatures that figure in the world’s rich lists (especially the realistic lists that include the dictators – Mubarak was wealthier than Bill Gates – and other corrupt plunderers of their own people), what exactly have most of these people done to deserve this pampering? Conversely, is there really so little understanding of what it means to have an economic system that is ultimately geared to the interests of these groups – does anyone really believe in trickle-down economics any more?

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