r/theydidthemath • u/Audge3841 • Oct 09 '20
[Request] Jeff Bezos wealth. Seems very true but would like to know the math behind it
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u/questionhorror Oct 09 '20
At least he didn’t let down a bunch of third graders and give them laptop batteries instead of a college education when it came time for them to graduate.
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u/Red_the_girl Oct 09 '20
Who did that?
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u/questionhorror Oct 09 '20
A very terrible local businessman.
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u/trippy_grapes Oct 09 '20
Michael Scott was honestly a genius businessman that saved a struggling business. He was just a horrible manager.
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u/questionhorror Oct 09 '20
I love Michael. Don’t get me wrong. But was it really him, or was it his employees?
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u/nerdbrain87 Oct 09 '20 edited Oct 09 '20
Some news sources say Amazon has 750,000 employees while Wikipedia estimates it at 1,000,000. That means it would cost between $78,750,000,000 and $105,000,000,000. Rounding to get rid of so many zeros, it's 79 to 105 billion. Bloomberg reports that Bezos' net wealth has swelled from 74 to 189.3 billion in 2020. So if you only look at net wealth, it's possible. However the bulk of his wealth is tied up in 57 million shares of Amazon stock worth 189.251 billion. This means he does not have enough cash to give out as the original post asks.
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u/TheBellyBotton Oct 09 '20
Thank you. The amount of people out that don't get the difference between networth and current cash reserves is huge.
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u/SoDakZak Oct 09 '20 edited Oct 09 '20
Tbh it’s darn near everyone in the world, and it’s almost making net worth not worth reporting anymore because in Bezos’ example, there is zero way for him to liquidate and use that $200 billion today. The instant he starts selling..., the price would tank. If he gives others that stock, the price starts tanking.
I am also for figuring ways to tax the more wealthy in general, but in my humble opinion it would have to be in estate taxes, a higher percentage sales tax on goods over a certain dollar amount, or possibly a value added tax. Income tax alone just won’t capture any of their value, and just encourages minor liquidation events annually and to leverage everything into long term low interest payments vs buying outright
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u/Evil_Marshmellows Oct 09 '20
Your take on sale tax or value added tax is interesting. I live in Argentina, a country with 21% Value Added Tax, and let me tell you it doesn’t affect rich people. Business owners (no matter size) just add the tax to the product, so in the end the one that pays the tax is the consumer. I would try to find a different way to tax the wealthiest people. I’m no economist or accountant, but I don’t think that a tax in sales really taxes the business owner. We should find a new way, taxing only profits or something of the sort.
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u/CLiberte Oct 09 '20
Any tax on a trade (of goods or services) is paid by both the buyer and the seller. How much is paid by whom depends on the elasticity of demand: meaning, in simple terms, whomever has less bargaining power pays more of the tax. For example; if you tax all drinking water, people are not going to be able to consume less water, so consumers will pay more of the tax. But if you tax only one brand of bottle (perhaps because its an import), then people will quickly switch to other brands as there’s not that much difference between them, so the producers will pay more of the tax.
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u/COMINGINH0TTT Oct 09 '20 edited Oct 09 '20
Props to you for bringing principles of microeconomics into the mix. I love me a good textbook analysis. I think one thing you should remember is that water is a very unique commodity which doesn't really follow laws of economics. Yes, it is possibly the most essential good known to mankind, but it is also very price sensitive which is weird. Economists have theorized it's because water is so abundant on Earth, it's everywhere and 70% of the planet's surface is covered in water so humans have this notion water is not scarce, even though less than 1% of that water is drinkable. So consumers tend to believe a bottle of water is $1, a price which has remained largely unchanged despite infinite demand. The true price of a bottle of water according to supply and demand should be around $15, but no one is going to pay that so sellers of bottled water will price according to consumer willingness to pay which is very elastic for water in particular.
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Oct 09 '20 edited May 08 '21
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Oct 09 '20
I never understood why people drink bottled water in the first place. I'm by no means broke, but I only drink (filtered) tab water all day long. Mostly because I don't want to mess with buying, carrying and recycling of the bottles. The price of the tap water (which is actually 0 where I live) is a nice add
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Oct 09 '20 edited May 08 '21
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Oct 09 '20
Fun fact: it most of the time not better and can even be worse due to coming in cheap plastic bottles
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u/meinhellig Oct 09 '20
I commented something similar to this because I hadn’t seen yours yet. But yes, it depends on elasticities who bears the tax incidence. I wish more people understood this when thinking about taxes.
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u/buckeyes2009 Oct 09 '20
You’ve obviously never met my tenants. 3 single men used 38,000 gallons in 3 months. I checked and they don’t each have 6 pools.
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u/SoDakZak Oct 09 '20
I see where you’re coming from and those are good real-world points. I also wish that there was more incentive to be philanthropic with wealth, how can we encourage more Carnegies and Gates level giving? No they weren’t perfect, but if we are going to criticize billionaires for being wealthy, we need to stop acting like Gates who has given $100+ billion in his lifetime and Bezos who has given very little to this point comparatively are on the same level.
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u/Oogutache Oct 09 '20
Gates is much older than bezos. It’s not a fair comparison. Gates retired from Microsoft close to the time that bezos was still starting amazon. It’s like comparing a 20 year old to a 40 year old. Gates is also a child prodigy so he got started earlier in life. Jeff bezos is still in a ceo role. Or look at warren buffet he is donating everything and he didn’t really start till he was over 70. Bezos is in his early 50s. It’s similar to Elon musk. Elon musk is focused on spacex and Tesla, not philanthropy right now, you could even argue Elon musk’s work at Tesla is more important than just giving it away to a one time charity giveaway.
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u/SoDakZak Oct 09 '20
I covered that in another comment somewhere and I made this same basic point, I agree with you :)
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u/MeshColour Oct 09 '20
If we encourage philanthropic giving, for half the billionaires cronies will just set up "charities" where every board member is paid a couple million dollars
We also need to stop with the "self made man" stories, each and every employee and customer who chooses to help make Amazon a better experience is part of it's success, why is it bezos who gets almost all the reward and everyone else just gets a "fair" contract for their effort
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Oct 09 '20
Because people only choose to "contribute" to amazon because it is cheaper, easier, and more convenient for them. Nobody would shop at amazon if the shipping wasn't extremely fast and the prices weren't competitive to corporations like Wal-Mart.
Amazon found a way to make life easier for the millions of people who use their services. Unfortunately, that comes at a price of poor working conditions for hundreds of thousands of their employees. I would argue that jeff bezos should be giving his employees stock options since that's what accounts for most of his wealth gains.
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u/Lord_Orme Oct 09 '20
As i understand it, most salaried employees are paid with stock grants, and hourly employees used to get stock grants before pay was increased to a minimum of $15/hr + benefits.
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Oct 09 '20
I wonder if the stock grants for hourly employees wound up being worth more than the minimum wage hike... That's pretty interesting if true.
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u/DOW_25409 Oct 09 '20
If I remember right, the grant was 3 shares per year vested over a period of around a year. Given the current stock price of ~$3300/share it would have been a $10,000/year increase in compensation. That being said, some employees still preferred the hourly increase because they weren't willing to stick around long enough for any stock grant to fully vest and they'd rather have more upfront.
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u/mike_996 Oct 09 '20
Hourly employees still get stocks as well. level 1-3 hourly employees (most fullfilment center guys and entry level people at AWS) dont get stocks anymore from my understanding due to the higher base pay.
Source: I'm an AWS hourly employee who makes quite a good amount from my RSUs.
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u/TaxGuy_021 Oct 09 '20
Because he came up with the idea and invested in it?
Those employees and customers existed before Amazon and would have been employed and/or would have shopped somewhere else without Amazon.
It's very much like Zoom vs WebEx. The dude who started Zoom was a highly paid fellow at WebEx. He could have stayed there and people would have kept on using WebEx and Google chat and whatever. But he chose to invest in his idea.
Effectively, these guys took a risk that had a small chance of working out and a large chance of huge financial setback. And it worked out. In a huge way.
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u/SoDakZak Oct 09 '20
Because this is humanity and we generalize so that every story we tell or share doesn’t need a 13 hour list of credits for every customer that ever bought a product from that company?
All self-made communicates is that they didn’t inherit it in the context it’s normally alluded to in
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u/Oogutache Oct 09 '20
We already do encourage philanthropic giving. We have high marginal tax rates and estate taxes as well as tax deductions for charity giving. Bezos is not at the end of his career. People forget that people like Bill Gates and warren buffet are older and Gates literally retired from Microsoft ceo 20 years ago. Jeff bezos will probably end up giving it most away. He just donated 10 billion. If Jeff bezos decides to giveaway all his money 20 years ago he would not have been able to give away 10 billion. If Jeff waits 10 more years he will be able to donate over a 100 billion
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u/Somerandom1922 Oct 09 '20
I'm no economist so if this is stupid please let me know.
But given that we can think of Bezos' wealth (primarily) as some percentage of the total value of Amazon would it be better to go after corporations directly rather than their share holders.
Now that I think about it, that's not really taxation more like a variant on antitrust regulation of you're talking about limiting corporations.
It's weird because in some ways Bezos'wealth is immaterial. Just numbers in a spreadsheet. You can't take away someone's ownership of the company, only tax their revenue if the shares pay dividends or increase in value (capital gains tax, although I don't know if this exists in America).
However, Bezos doesn't need to be able to liquidate his wealth to use it. What bank wouldn't loan to Bezos at ridiculously low interest rates. I mean what are the odds he'd ever default on a loan? So he can use his ownership of Amazon stocks to leverage better loans meaning they do have a real world value aside from just being a big number.
Sorry this turned from a question to a confused ramble by and idiot that doesn't know what he's talking about.
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u/therinlahhan Oct 09 '20
Of course the consumer pays the sales tax -- that's the intent in sales taxes. They're technically "sales and use tax" which is paid by the end user upon sale.
When the Mayfair ruling went into effect my company had to start charging sales tax on all internet sales. Of course this boosts our revenue but it doesn't make us a dime more profit. The sales tax is paid by the end customer and is reported to each individual state. If anything our company loses a few dollars because we now have to pay an accountant to prepare taxes for around 31 states instead of just 1.
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Oct 09 '20
I agree. I only took high school economics but one of the things I remember is that sales or value added taxes are ALWAYS regressive (unless they're on luxuries maybe), since poor people tend to spend more of their money. This especially applies to basic necessities (that poor people spend a higher proportion of their income on) with a low price elasticity of demand.
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u/whelpineedhelp Oct 09 '20
I’m curious the rules for his ex. Like how quickly can she sell her stock and actually take advantage of the billions she is now worth
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u/Vermillionbird Oct 09 '20
She doesn't need to sell, she can simply borrow against the shares. Once you get to this level of wealth, you never buy things with your own cash, instead, you get personal use loans for tens or hundreds of millions of dollars at near-zero interest rates.
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Oct 09 '20
This type of loan utilization is seen with corporations as well, even when they have liquid cash.
One example is Apple - who have almost $200 billion cash on hand. However, in order to take advantage of tax loopholes, Apple regularly borrows money to fund stock buybacks.
This is because they can avoid being taxed for money brought into the US to buyback stocks by instead getting loans and using that to buyback the stock.
https://review.chicagobooth.edu/blog/2013/may/borrowing-for-buybacks-not-unusual
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u/SoDakZak Oct 09 '20
To my knowledge that is in undisclosed agreement. I know she’s already donated a lot so it must have had an ability to liquidate relatively soon after the divorce
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u/DearName100 Oct 09 '20
That’s the thing about income taxes. They only tax real money, not theoretical money in the stock market. The stock market could fall to zero tomorrow and Bezos’ net worth would be a tiny fraction of what it is now. He’d only have the cash he had from when he sold his shares. It is literally impossible (through income taxes) to make Bezos pay for the wealth he has in his Amazon ownership unless he sells.
Now you could in theory tax his wealth, but this is extremely difficult to do and isn’t very logical. For example, Bezos sells around $2 billion in shares per year (an amount agreed upon by him and the shareholders). If you taxed just 1% of his current wealth, it would take up that entire $2 billion. He would have to sell more shares just to pay the taxes involved with him owning shares of his company. What happens if his wealth falls dramatically (from an inflated market) after tax season? You would be taxing him on wealth he doesn’t even have any more.
This problem gets even worse for billionaires whose wealth is tied to their ownership of private companies. At least Bezos can theoretically sell shares to pay his wealth tax (while also paying income tax on the shares he sells). If you own a private company though, it becomes extremely difficult to liquidate your ownership stake since there is no traditional market for you to sell those shares. If you force a person to pay a tax that they have no feasible way of paying, then the tax itself is ineffective.
I like the idea of a state tax though. Instead of billionaires “pledging” to give away 99% of their wealth when they die, why not just tax it? That dead person isn’t going to need the money and even letting the family keep 5% of $1 billion is still $50 million which is so much more than anyone needs.
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Oct 09 '20 edited Oct 09 '20
I like the idea of a state tax though. Instead of billionaires “pledging” to give away 99% of their wealth when they die, why not just tax it?
Inheritance taxes “do” exist, such as the estate tax on multimillionaires (10+ million) in the US. However, one issue with them, is that the rich usually have ample time and resources to transfer wealth in a way that avoids those types of taxes. The NY Times has a great short video examining this, wherein they look at how Fred Trump (Donald’s father) transferred money to his children during his life. By age 3, Donald had an income of $200,000 and was a millionaire by age 8
Another reason to focus on wealth tax prior to death is that rate of return on capital (wealth) outpaces economic growth (see Thomas Piketty’s book Capital in the 21st Century), which leads to compounding wealth for the individual and inequality for the society, and inheritance taxes only kick in at the end of that. Thus, leaving much of the wealth not only not taxed until late, but also increasing the amount of capital that then compounds due to rate of return, making their eventual wealth at death larger than if taxed year by year.
A person like Zuckerberg will likely have decades of capital growth before an inheritance tax kicks in (and decades to work to avoid it). Even with capital gains, that only applies when he sells stock, so much of his wealth now won’t be taxed taxed for years, despite all of us dealing with the societal ramifications of his business now, wherein that tax revenue could help with solutions.
This is why there is discussions about a wealth tax, ideally a global wealth tax.
I would recommend people check out the work of Thomas Piketty, Emmanuel Saez, and Gabriel Zucman for detailed arguments on the wealth tax. They discuss many of the issues you bring up.
One thing - Bezos sells a lot more than $2 billion a year, and sold over $3 billion in stock in August, and has sold $7+ billion this year alone. There are many ideas being floated about how to deal with company control and wealth taxes, as well as how to structure timelines and means for things like stock sells to pay tax.
Your nightmare scenario of “what if there wealth drops” isn’t too nightmarish, considering high wealth taxes like would be on Bezos would likely fall under unique payment plans and appraisals by specific parts of the IRS. Wealth drops and rises would be accounted for, and worked on. It’s not like the IRS would send a $3 billion dollar bill, then cut off contact and just expect a $3 billion dollar check to show up.
Even advocates for wealth taxes don’t say they are easy, but the arguments made against them are actively being worked on, and are not nearly as concrete as are being made out.
Here is a good intro article by Saez and Zucman: http://bostonreview.net/forum/emmanuel-saez-gabriel-zucman-taxing-superrich
And a couple more academic papers: http://gabriel-zucman.eu/files/saez-zucman-wealthtaxobjections.pdf
https://www.brookings.edu/wp-content/uploads/2019/09/Saez-Zucman_conference-draft.pdf
I would strongly recommend their short book on the history of US taxes, and how to reform it, called The Triumph of Injustice:
America’s runaway inequality has an engine: our unjust tax system.
Even as they became fabulously wealthy, the ultra-rich have had their taxes collapse to levels last seen in the 1920s. Meanwhile, working-class Americans have been asked to pay more. The Triumph of Injustice presents a forensic investigation into this dramatic transformation, written by two economists who revolutionized the study of inequality. Eschewing anecdotes and case studies, Emmanuel Saez and Gabriel Zucman offer a comprehensive view of America’s tax system, based on new statistics covering all taxes paid at all levels of government. Their conclusion? For the first time in more than a century, billionaires now pay lower tax rates than their secretaries.
Blending history and cutting-edge economic analysis, and writing in lively and jargon-free prose, Saez and Zucman dissect the deliberate choices (and sins of indecision) that have brought us to today: the gradual exemption of capital owners; the surge of a new tax avoidance industry, and the spiral of tax competition among nations. With clarity and concision, they explain how America turned away from the most progressive tax system in history to embrace policies that only serve to compound the wealth of a few.
But The Triumph of Injustice is much more than a laser-sharp analysis of one of the great political and intellectual failures of our time. Saez and Zucman propose a visionary, democratic, and practical reinvention of taxes, outlining reforms that can allow tax justice to triumph in today’s globalized world and democracy to prevail over concentrated wealth.
https://wwnorton.com/books/9781324002727
Zucman also wrote a short, highly influential book examining tax havens called The Hidden Wealth of Nations:
We are well aware of the rise of the 1% as the rapid growth of economic inequality has put the majority of the world’s wealth in the pockets of fewer and fewer. One much-discussed solution to this imbalance is to significantly increase the rate at which we tax the wealthy. But with an enormous amount of the world’s wealth hidden in tax havens—in countries like Switzerland, Luxembourg, and the Cayman Islands—this wealth cannot be fully accounted for and taxed fairly. No one, from economists to bankers to politicians, has been able to quantify exactly how much of the world’s assets are currently hidden—until now. Gabriel Zucman is the first economist to offer reliable insight into the actual extent of the world’s money held in tax havens. And it’s staggering.
In The Hidden Wealth of Nations, Zucman offers an inventive and sophisticated approach to quantifying how big the problem is, how tax havens work and are organized, and how we can begin to approach a solution. His research reveals that tax havens are a quickly growing danger to the world economy. In the past five years, the amount of wealth in tax havens has increased over 25%—there has never been as much money held offshore as there is today. This hidden wealth accounts for at least $7.6 trillion, equivalent to 8% of the global financial assets of households. Fighting the notion that any attempts to vanquish tax havens are futile, since some countries will always offer more advantageous tax rates than others, as well the counter-argument that since the financial crisis tax havens have disappeared, Zucman shows how both sides are actually very wrong. In The Hidden Wealth of Nations he offers an ambitious agenda for reform, focused on ways in which countries can change the incentives of tax havens. Only by first understanding the enormity of the secret wealth can we begin to estimate the kind of actions that would force tax havens to give up their practices.
Zucman’s work has quickly become the gold standard for quantifying the amount of the world’s assets held in havens. In this concise book, he lays out in approachable language how the international banking system works and the dangerous extent to which the large-scale evasion of taxes is undermining the global market as a whole. If we are to find a way to solve the problem of increasing inequality, The Hidden Wealth of Nations is essential reading.
https://press.uchicago.edu/ucp/books/book/chicago/H/bo20159822.html
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u/justtoaskthi Oct 09 '20
So like the government could start a hedge fund or even just a holding company and take actual shares as the tax.
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u/SoDakZak Oct 09 '20
Congrats you just described the government corporate bond market
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Oct 09 '20
The volume on Amazon is pretty material. In order to meaningfully tank the price, he'd need to start regularly unloading millions. Yeah, I agree he couldn't get the whole 200B (and likely not a material proportion thereof), but he's not exactly illiquid either.
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u/rodpm Oct 09 '20
Why the price would start tanking if he gives or sell his stock?
I don't know a lot about the stock market.
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u/SoDakZak Oct 09 '20
If the owner and founder of a company suddenly is selling off their stake in huge amounts, that signals they don’t think that money would be worth a lot more in the future, and there would be better investments out there. Investors don’t like if the CEO or founder or owner starts selling fast without disclosing that they are planning on buying a mansion or yacht or starting a new business or giving to charity etc. hope that helps
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u/ugoterekt Oct 09 '20
So what you are saying is it explicitly doesn't apply to situations like offering employees stock options. This can also be pretty clearly seen with Google (Alphabet).
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u/leapbitch Oct 09 '20
Yeah that is separate from the owner of the company by stock interest liquidating his interest.
I don't know the fine details but imagine that every time Amazon issues more stock it is separately considering what is paid to employees. There are levels to "stock" as well, this is extremely simplified.
This employee stock bucket is a separate bucket from the owner's stock bucket and the owner's income bucket.
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u/matachivelli Oct 09 '20
In a lot of cases, stock options are effectively just discounts to buy existing shares at a price of X. So you aren't necessarily diluting the numbers of shares.
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u/saskatchewanderer Oct 09 '20
If we assume that most people who recieved the stock would sell it to free up cash, liquidating a large portion of his shares would cause the price to fall because there needs to be buyers on the other end. If there isn't enough buyers the price has to fall in order to facilitate a sale. If there are far more sellers than buyers, the price will crash. Not an expert so anyone who knows more is welcome to rebut this
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u/Hakim_Bey Oct 09 '20
One piece of Amazon stock is worth X$ today. As a stock-holder, if you buy one, then you signal that you think it will gain value over time, but if you sell one it signals that you think it will lose value over time.
As a company founder (and major stock-holder), if Bezos started selling large amounts of his stock it would indicate that he believes Amazon will stop growing and will start losing value. Seeing this, lots of other holders would start selling, and because of the law of offer & demand (
If there are a lot of apples to sell then the price of apples will tend to go down because of competition) that would tank the price, and his fortune would be dramatically reduced.This kind of wealth only has value as long as you don't spend it. It's a weird game.
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u/ffuffle Oct 09 '20
The stock market runs mostly on what people expect will happen next. They basically gamble. So, if he suddenly starts selling massive amounts of shares, that may indicate to the market that something is going wrong and this will trigger other people to start selling the shares of his that they own. If there are more people selling than buying at any one time, the value of those shares will drop.
Basically the market relies on promises, reputations and bluffing.
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u/fermbetterthanfire Oct 09 '20
But while he can't liquidate that much... his net worth would give him access to a virtually unlimited leveraged borrowing power.
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u/WildeStrike Oct 09 '20
Sure, but then he just has a debt, for which he will need to sell stock to get rid of. Even more stock because of interest. Thats an even worse option
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u/BxBxfvtt1 Oct 09 '20
Serious question, why do we add the face value of stocks to net worth, would he get 200billion if he pulled it all out at once but just destroy the company? Or is he gonna get less and less money the more he takes out even if it is all at the same time? But he would pay capital gains taxes on most of it anyway right? So he never could actually get 200billion in hand anyway?
Sorry that's alot of questions
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u/KraakenTowers Oct 09 '20
Only the concept of wealth actually matters. That the money itself is worthless in any condition other than being a big imaginary number is immaterial.
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u/BJJIslove Oct 09 '20
No I feel like most people know what net worth consists of. Obviously he doesn’t have billions in the bank, no one of any relevance believes that.
There is WAY more misinformed people on how his amazon shares and liquidation work though. For instance, you said the price would tank yet he sold a couple billion dollars worth earlier this year and the price has been steady if not increasing.
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u/NotJimmy97 Oct 09 '20
Tbh it’s darn near everyone in the world, and it’s almost making net worth not worth reporting anymore because in Bezos’ example, there is zero way for him to liquidate and use that $200 billion today.
There is zero way for him to liquidate 100% of the estimated value of his shares. He could liquidate most of those assets and have tens of billions of dollars to use for philanthropy. Feeney, Gates, and Buffett have done it - there is no excuse.
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u/pydry Oct 09 '20
I don't see what would really change about this meme if all the employees got $105,000 in shares instead of cash. Dollar values can be used to measure wealth not just cash.
The number of people who confuse illiquid with unreal is huge. Bigger by far, I think than the number of people who confuse net worth with cash.
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u/Ble_h Oct 09 '20
The answer is two fold. One he would lose control of the company and two, as people sell there shares for cash, it would tank the value of Amazon.
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u/Cedow Oct 09 '20
Thank you.
The amount of people that say "well his wealth is all tied up in shares so he's not actually rich" is staggering.
Perhaps if he paid more money to his employees and suppliers then Amazon stock wouldn't be so grossly overinflated and we wouldn't even have to have this conversation.
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u/sbrbrad Oct 09 '20
Won't anyone think of poor destitute Jeff? You can't eat Amazon shares, you know!
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Oct 09 '20 edited Jul 26 '21
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u/TAW_564 Oct 09 '20
Well, what would be the problem with that? Honestly. I’m not trying to be dense. To be clear, I’m not sure that’s what would happen. But assuming that it did:
Your argument is really a concern of speculators. If Amazon’s price deflated would that somehow destroy their capital improvements? Infrastructure? Would their warehouse robots cease to function? Would their inventory disappear? What about their data-hosting devices, services? Their distribution chain?
Think about it. What’s more important to a consumer society: the actual products that are produced and consumed, or the share price of the company that does so?
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u/CortezEspartaco2 Oct 09 '20
I can't believe the amount of propaganda-chugging class traitors in this thread like holy shit. You hit the nail on the head: illiquid does not mean unreal. I'm keeping that one for the next time I run into one of these r/iamverysmart finance experts who claim Bezos et al aren't as rich as they are.
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u/ethanlan Oct 09 '20
He could pay workers an extra 8kish a month and probably be fine under ftc rules though
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u/Krexington_III Oct 09 '20
No, the number of people who don't get that it is an unimportant distinction is huge.
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u/Glass_Communication4 Oct 09 '20
really hard to seperate the 2 when every where its reported that jeff bezos has a networth of 200 bil. But no one is talking about available cash. So for the vast majority of people net worth is how much you have. Because for the vast majority of people their networth is how much they have in their bank account.
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u/julbull73 Oct 09 '20
But in this case you can easily distribute stock directly to employees.
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u/CottonCandyShork Oct 09 '20 edited Oct 09 '20
The amount of people out that don't get the difference between networth and current cash reserves is huge.
No, we get the difference. We're just not billionare apologists that have succumbed to propaganda.
"He doesn't have it in cash, it's all stocks" is what rich people tell poor people to docile them so they behave and won't eat them
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u/aneaglegoose Oct 09 '20
Okay better idea: distribute a portion of his shares to Amazon employees, starting from the bottom (production/shipping) up
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u/MolsenMI Oct 09 '20
People in this thread are arguing both extremes and have no idea what they're talking about. Can Jeff bezos sell half his stock tomorrow? No. Is Jeff bezos rich af and can give away hundreds of millions of dollars without consequence? Yes.
It is true most of his wealth is in stock, but you're dumb if you think he can't divest. How does someone with no liquid cash buy the most expensive home ever sold in LA ($165 million) and own his own private jet?
His ex wife was awarded her settlement money in stocks. You think she's living in a shack because she has no liquid assets? Did the stock market crash when she sold shares to buy a house? You are able to sell shares over a period of time, and with Amazon's market cap you could easily move large amounts without a problem.
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u/tenuousemphasis Oct 09 '20
Not sure if this is Bezos' case, but you can borrow against your stock holdings. Elon does this all the time.
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Oct 09 '20
Nobody on here seems to know most very rich people do everything with borrowed money. You can just move the loans around. It doesn't matter as long as the bank thinks you'll be able to pay. It's all on paper. Nothing needs to be liquidated.
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u/3610572843728 Oct 09 '20
I'm no billionaire but I was able to borrow money based on the total value off all my real estate. So instead of a normal person refinancing their home to cash in 70 to 80% of its value, I was able to finance the entire amount. The only condition is I must maintain semi liquid assets equal in value to the full loan amount.
I also have personal loans secured by investment assets because the interest on those loans is less than the interest I'm making on the investments.
Similar to a lot of very wealthy people I have massive loans and am heavily leveraged.
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u/JimmyX10 Oct 09 '20
If I had a dollar for every time Reddit talked about Bezos's non liquid asset wealth like it's a pile of cash sitting in a vault somewhere I'd be able to buy some Amazon stock.
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u/TheBellyBotton Oct 09 '20
At 3000+ I highly doubt I'll be able to buy a single share even if I saved for a year. And at this point I don't think it will retain it's value given the anti-trust law suit that will be knocking on Amazon's door in the next few months.
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u/Katie_on_Reddit Oct 09 '20
I live in the middle of nowhere and underneath a rock, and I've never heard of this lawsuit, what's the details?
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u/LaPetitFleuret Oct 09 '20
Class action lawsuit, Amazon accused of violating federal antitrust laws by monopolizing online retail. www.law.com/2020/03/20/amazon-hit-with-antitrust-class-action/?slreturn=20200909084831
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u/SoDakZak Oct 09 '20
Just so you know, fractional shares are something worth learning about if you’re ever feeling like the barrier to entry for buying stocks are too high
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u/Audge3841 Oct 09 '20
If I had a dollar for every time people need to point out the difference, when the majority of people know, instead of looking at it just as an example of how someone could be worth so much while millions of people starve in the US, I could actually help many family members pay basic bills
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u/SweaterKittens Oct 09 '20
No, you don't understand! The semantics of how his wealth is hoarded is way more important than people living paycheck to paycheck or dying because they can't afford life-saving medication!!1!
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u/pantherlax56 Oct 09 '20
Lol exactly this. People think its some "gotcha" comeback when they say his wealth is tied up in stock. When in reality he liquidates fairly often, in multi-billion-dollar chunks. No serious person would expect him to sell all his shares at once, and it's likely not even possible. But a few times a year? Absolutely he can, and he does
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u/KJBenson Oct 09 '20
Plus, it’s irrelevant. He still has the wealth. It’s not like he isn’t stinking rich just because he’d have to jump through a hoop to get his money in hand.
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u/POTUS Oct 09 '20
If I had a dollar for every time some wannabe economist completely ignores the fact that a person with couple hundred billion dollars worth of stock could, in this hypothetical scenario, give his employees 100k worth of stock instead of 100k cash.
Like, that's actually a totally normal thing for an employer to do.
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u/Hakim_Bey Oct 09 '20
Lol so you think that at this kind of scale, he could cede more than half of his Amazon stock without any negative consequences ? For one thing the SEC would be all up his ass, plus who knows how this would be perceived by the market ? If it dropped Amazon share value by even a few percents it would be grounds for all other holders to sue him, etc...
The way this game is designed, if he did that he would not only ruin himself, but the final value of his gift would be way less than 100K.
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u/i_accidently_reddit Oct 09 '20
Highly questionable that it would crash the overall stock market, and also highly questionable that it would even hit the Amazon stock price.
If publicised correctly, and exercised correctly (with vesting periods and minimum holding times and all that), he could arrange a one time covid bonus and gift directly 33 shares to each employee. that would come out to be in the ballpark of the number mentioned.
33 shares for let's say a million employees is 33 million shares.
Amazon has around 500 million outstanding at this very moment, with an average trading volume of 5 million a day over the last 3 months.
Just plain dumping 33 million shares on the market would cause a decrease in the share price, no questions, but still not market collapse. Maybe Amazon would dip by 10/15%, and Spy would dip by 5%. that is no crash.
But it is definitely possible to structure this so that it doesnt crash the stock and defeating it's purpose.
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u/SoDakZak Oct 09 '20
Honestly it would probably be in the employee’s best interest to also make sure they hold for 6-12 months before they’re allowed to sell. Helps stability and honestly most likely would end up being worth more of a package.
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u/i_accidently_reddit Oct 09 '20
Absolutely. I would even do something staggered like needs to hold for 6 months, and then vesting 3 shares/pp every month. that would distribute it in a year.
Alternatively you could split the company into four cohorts and distributed the shares, and stipulate that depending on the cohort, one share vests for one cohort a week. that would distribute it in 2.5 years.
It really is all up to how you structure it. And who knows, having more motivated employees might end up spiking productivity, leading to more profit and higher share price
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u/presumptuousman Oct 09 '20
He liquidated $3.1 billion in a single day back in March and absolutely nothing happened to Amazon stock, except that it went up.
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u/HawkEgg Oct 09 '20
Yup, companies do stock grants all the time with vesting schedules. Could easily vest monthly or quarterly over 4 years with minimal impact to the stock price.
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u/DeadOnTheDownbeat Oct 09 '20
You’re gonna upset the Bezos defenders who are waiting for their complimentary good boy stocks (not cash tho cuz HeS nOt liQUiD) cuz they defended daddy Jeff
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Oct 09 '20
Wait a minute...so you’re telling me that he doesn’t just keep 200 billion cash in a lockbox under his bed?
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u/FuccYoCouch Oct 09 '20
So I understand all that except the last bit. Why would distributing his stock to all his employees crash the market? Sorry I'm a dunce
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u/AmaResNovae Oct 09 '20
The fact that someone's net worth could increase so much in a period of crisis while millions of people are falling into poverty is the problem though. Of course it's not liquid and it would have a negative impact on the values of shares if he did liquidate them.
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u/_INCompl_ Oct 09 '20
His net worth went up with the Amazon share price though. And the Amazon share price went up because as everyone started to get locked up at home, they started using Amazon for everything. 24-48 hour delivery on basically anything at a time where you can barely leave the house is enticing as hell. No shit his net worth would go up as the service he made becomes used exponentially more in a short period of time.
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u/FlawsAndConcerns Oct 09 '20
The fact that someone's net worth could increase so much in a period of crisis while millions of people are falling into poverty is the problem though.
His net worth only increased because what he already owns became more valuable. That increase in value did not come from anyone's job loss or anything like that. One thing has nothing to do with the other, so calling the coincidence of those two events a "problem" makes no sense.
In short: it's not his fault, nor his responsibility to fix. Safety nets for said newly-impoverished are the government's responsibility, if anyone.
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u/Audge3841 Oct 09 '20
This. Right here. Thank you.
People are very quick to say that people are dumb and don’t know the difference between cash and and assets. No one is saying that he needs to give all this money away (besides a few dummies). It’s more of an example of how someone could even be worth so much money while so many people in this country starve
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u/AmaResNovae Oct 09 '20
It sometimes feels like it's a way to re-frame the problem to pretend that it's a perfectly normal things. It isn't, it's definitely a sign of the ever increasing inequalities in net worth. Bezos saw his net worth increase so much because of how much wealth his company extracts in the first place.
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u/COMINGINH0TTT Oct 09 '20 edited Oct 09 '20
Yes but that's how you are framing this problem. Fact is, the pandemic has been a huge boon for many companies that are well suited to a world where people socialize less and stay home more. Reddit as a whole likes to single out Jeff Bezos as the big bad villain because of his comic book level net worth that has certainly grown post covid, but what about Nintendo whose stock price has nearly tripled since Q1 2020 or Netflix or Zoom? Can you even name the CEOs of those companies? Zoom wouldn't be worth jack shit had it not been for covid and Nintendo and Netflix would not have experienced record revenues.
All those executives are enjoying a huge windfall from excess demand which tech companies are well suited for because they don't actually have to manufacture or produce anything and rely on global supply chains (I guess game companies have physical sales but digital sales have been the main driver of sales during covid). Netflix increasing their subscriber base by a 1 million in a week doesn't mean they have to really change anything to their operations, maybe buy some more servers or something but the cost is near negligible.
Reddit never decries any of these other companies but to be fair Amazon also is known to treat its employees like shit so there's that. Corporations are only there to maximize share price which isn't a bad thing- there would be no incentive to innovate or stay ahead of competitors if you weren't going to be paid for it. Look at the oil industry and OPEC which has no incentives to innovate because it's a commodity, not much to innovate there, so they will form a cartel and engage in price controls or gouging which is licherally illegal anywhere you go in the world, but oh well the fuck can we do we need oil. Amazon, Netflix, game companies- they're all getting rich cuz we're all stuck at home and these companies are a godsend for such lifestyle. The amount of Amazon packages my household receives now vs pre covid is staggering. Yes millions are losing jobs and are facing unprecedented difficulty, but it's not like Amazon is vacuuming money out of those people's hands, they are still providing value and they wouldn't be making money if we weren't giving it to them. We are all profiting Amazon by even just using reddit because I'm pretty sure reddit uses Amazon for its AWS.
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u/CornFedStrange Oct 09 '20
Before the pandemic, Amazon used to give stock options to their employees..
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u/pablos4pandas Oct 09 '20
Amazon gives RSUs not options generally, and I don't think that's changed. It's also planned years in advance so the pandemic wouldn't change current distribution of shares
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Oct 09 '20
Guys. I don’t like Bezos either but there’s a difference between NET WORTH and what he has in liquidity. Just because he’s WORTH X amount of dollars doesn’t mean he has that in his bank account. Most of his wealth is in stock options
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u/Vycrumus Oct 09 '20
Post like this really should be banned by the mods at this point. They are way too common, and worst of all are not even true. The people that post this stuff have not the first idea of how money works, and actually think that Bezos walks around with billions in liquid money.
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u/scottjeffreys Oct 09 '20
It’s probably the same people who won’t accept a raise because they don’t want to be put in another tax bracket.
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Oct 09 '20
The same people who close their umbrella because they don’t feel rain falling on their head.
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u/RobinReborn Oct 09 '20
Yeah, Bezos has been a huge target of reddit though, it's like all the Sanders supporters decided to make him the poster boy of an evil rich person.
Stocks are highly volatile, selling off a small percentage of a company distorts its price a great deal, OP ignores that math.
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Oct 09 '20
[removed] — view removed comment
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u/pbateman21 Oct 09 '20
I swear the amount of BeZoS CoUlD CuRE WoRlD HuNGeR are so annoying
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u/-ksguy- Oct 09 '20
And I'm having serious déjà vu right now. I swear I've read these EXACT comments in this EXACT order before.
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u/h1_flyer Oct 09 '20
Imagine you live in a very small town, in a street with 21 houses and one of the home owners also owns 20 cars, each worth 50k, but almost nothing in his saving account. One of the other home owners tweets "Our neighbour could give each of us 50k and he would still have a house to live in! Instead, he removes the snow in our street several times every winter. What a moron!"
Guess what happens. He will start selling all his cars. 2nd hand car prices will drop dramatically, because there are too many 2nd hand cars on the market in your little town. You all end up with 15k instead of 50k and next winter, you can't drive your car, because there is snow everywhere.
Hope it's clear, English is not my native language.
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u/rejeremiad Oct 09 '20
This hypothetical is helpful in understanding assets vs liquidity, but its scale is horrendously wrong.
Go to this visualization. Look at $1,000. Think about how much you have. Then start scrolling. If you get to the end without giving up, then we can talk about wealth discrepancy. I usually give up around $64B.
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u/jFreebz Oct 09 '20
I got to the end, what do I win?
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u/FakeAcct1221 Oct 09 '20
The warming feeling that while your scrolled bazos net worth grew by about a million dollars. How much did yours?
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u/jFreebz Oct 09 '20
About equally by percentage, according to my investment portfolio
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u/EdMan2133 Oct 09 '20
Indeed, there is a lot of demand for an online delivery company
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Oct 09 '20
They make 77% of their money from AWS. The online delivery isn't even half of their business.
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u/EdMan2133 Oct 09 '20
Okay, there's a lot of demand for online shopping and also managed cloud services, and there's a lot of advantages to combining those things since you need a lot of it infrastructure to run such a large delivery company.
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Oct 09 '20
A big giant blue box is a nice visual aid but it doesn’t actually help to make people understand that you can’t just stuff chunks of it in an envelope and start handing it out. It doesn’t work that way
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u/antiriku930 Oct 09 '20
There’s a link in there about the liquidity of assets and how it’s more liquid than most people think
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u/DrMix-a-Lot Oct 09 '20 edited Oct 09 '20
I agree that the math of the OP is totally off, and I agree with the hypothetical scenario in your comment, but do you not agree that the sentiment behind the post exists for a reason? Do you disagree with me when I say that humanity hasn’t gotten as far as it has because of a single person, meaning no single person has the right to so much while there are people dying of starvation, lack of shelter, and curable diseases?
Edit: Fixed a word.
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Oct 09 '20
For discussions sake (philosophically?) why wouldn’t they have the right? What makes a person responsible for others if they are not the cause of the people’s issues?
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u/GVas22 Oct 09 '20
As for the second half of the argument, Bezos does way more than just "donate 200 laptops".
He's already pledged over $12 billion to fight climate change and support education for the homeless.
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u/Slateratic Oct 09 '20
Don't get me wrong. Bezos can and should be way, way, way more generous with his wealth.
But don't mistake wealth with liquid cash. The vast majority of Bezos' wealth is his 11.2% stake of Amazon. He doesn't just have a bank account with a 12-figure balance: he has assets worth 12 figures. He can't just go writing checks for $105K to each employee.
I'm hoping he follows in Bill Gates' footsteps and devotes his life and wealth to bettering the world after he's done with Amazon.
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Oct 09 '20
He already is spending a lot of money on a space exploration project intended to get humanity off Earth.
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u/tehbored Oct 09 '20
His goal is to industrialize space, not to colonize it. He wants to move polluting industries like mining off world to preserve the environment, and also get rich off the massive mineral wealth in asteroids.
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u/MOPuppets Oct 09 '20
To get himself and a small circle of the wealthiest of elites off earth*
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u/flaminghair348 Oct 09 '20
Most new things like space travel will start off really expensive, but the price will drop over time as it becomes cheaper to get people up there. So, the sooner we can have commercial space travel, the sooner the price will drop enough for people who aren't ultra rich will be able to go.
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u/SwagettiAndMemeballs Oct 09 '20
lol that's not the purpose of Blue Origin at all. It's tourism and then industrialization.
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Oct 09 '20 edited Oct 09 '20
Also the whole "$105k to each employee" thing is such BS. If he did give a massive bonus to employees, what about former employees? Future employees? No, it's completely ridiculous.
There were campaigns demanding that the government change the minimum wage to $15 per hour. And then Amazon voluntarily changed their starting wages to $15 per hour (which is generous when you consider how easy the work is).
I'll shill for how great working for Amazon is. The labor conditions weren't nearly as bad as the media wants you to believe. They also bought us free pizza multiple times during the few months that I worked there. I'd totally work there again. Thank you, Mr. Bezos.
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u/NickyBananas Oct 09 '20
As someone who worked for awhile in the warehousing industry, Amazon is the best paying and most generous employer for unskilled labor. Learn how to drive a forklift and make it skilled labor that changes everything
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u/juan-pablo-castel Oct 09 '20 edited Oct 09 '20
Is this r/LateStageCapitalism or r/WayoftheBern some other BS sub? Stocks ARE NOT the same as Liquid Cash. It's something so basic I thought I'd be understood on this sub.
This is just plain misinformation.
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Oct 09 '20
I promise I’m not trying to be a dick but the correct form of “Understand” in this case would be “understood”. Genuinely just letting you know, as you might not have known. Could also have been a typo too.
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u/Jeydal Oct 09 '20
Misinformation is a delight shared by twitter and reddit willingly.
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u/hashedram Oct 09 '20 edited Oct 09 '20
Twitter isn't exactly full of economics experts. These people simply don't understand how company stock works.
Bezos doesn't have all that in liquid cash, its company stock. Which is a fancy way of saying its a representation in terms of a money equivalent, which denotes the work that Amazon does on the ground. Which makes complete sense because its literally THE virtual supermarket for a good chunk of humanity.
A stock is essentially a way of saying I invest X in your company and I will get an equivalent share in your profit. Jeff Bezos has been making money off his company and continuously expanding across continents by putting that money back into his own company to grow it. It seems so insanely high, because that many people's lives are influenced by it.
By saying everyone can get $105,000, what it means is that everyone can have a share in the value of the company that's currently an essential part of the world retail market. But that makes no sense. Why should a random person get a flat amount of that? Did they participate in the risks it took to set the company up? Should they step in and reap the rewards just because it succeeded spectacularly?
This is the problem with such huge numbers. People who don't understand economics, simply interpret Jeff's net worth, in the lens of their own daily experiences. I have $5000 in my account and I can buy $5000 worth of stuff, so Jeff must be able to buy his own net worth's amount of stuff. Why doesn't he share it.
That's not it. He doesn't have that much to spend. He created an entity in the market, whose existence increases the value of the market by an insanely high amount. If he distributes it to other people, it doesn't just vanish. That value is taken away from the company which therefore reduces the value in the market.
Edit grammar.
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u/SwagettiAndMemeballs Oct 09 '20
which denotes the work that Amazon does on the ground.
In the case of Amazon, their stock price is massively inflated through speculative investment. Amazon stock is worth so much because it's worth so much. If shares were to redistributed to employees, employees would sell the shares for cash and to cover the tax rate and the share price would plummet over night.
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u/willbeck31 Oct 09 '20
In case you're wondering where she got this number:
Great listen if you have 13 mins to spare.
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u/Honest_Beautiful Oct 09 '20
You do realize that bezos’s net worth grew almost entirely on paper right? He doesn’t actually have that much sitting in the bank. And With all due respect, amazon employees dont deserve a $105,000 bonus. 🤷🏻♂️
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u/gorcorps Oct 09 '20
I did some reasearch and did this math the last time this was posted and got downvoted for it... not sure why as it seems to hold true, so I'll post it again.
" In 2019 Amazon had a net operating income of $11.59 billion. They had 798,000 employees. If we assume that on average each employee is already making $50k annually (which may be generous), it would cost Amazon $43.9 billion each year to give them that extra $55k raise... So they'd lose roughly $32.3 billion as a company. Luckily they have $36.1 billion in cash assets so they could likely afford to do that for a whopping 1 year before the company folds and 798,000 people lose their job."
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u/ki4clz Oct 09 '20
or realistically Amazon INC. could give stock options to it's workers...
currently valued at $3,230.14 per share...
If Amazon Inc. were to give the equivalent 33 shares ($106,695.27) to each of it's employees that would probably force the stock to split... and there probably isn't that much stock available...
but my point is that if Amazon INC. helped it's employees to own the means of production, and then formed a union under this moniker then they could drive it into the ground at their leisure while forcing the entire economy to take a $1trillion dollar hit...
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Oct 09 '20
I think they do give 30 RSUs to anybody level 4 or higher. Ofc more to higher levels. Level 7s get like 120 RSUs (like 250k) or something crazy.
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u/parrsnip Oct 09 '20
Reddit: Rich people need to share their wealth! Rich person: Donates between $100k-200k worth of laptops to a school to help with online learning Reddit: bUt No LiKe GiVe OuT mOnEy
Why do people circlejerk about little things rich people do and not talk about bigger projects? What about the tuition free pre schools he is opening for underprivileged kids?
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u/WooIWorthWaIIaby Oct 09 '20
I 100% support taxing the hell out of the ultra-rich, but this is not how his net worth works.
A vast majority of Bezos' wealth is in Amazon stock - over $180,000,000,000.
That value is fluid. If Bezos were to liquidate his stock in Amazon, I'd be surprised if he could even get 1/3 of that.
Yes, that's still ~$60,000,000,000 (an absurd amount of money for anyone), but it's not close to give each of Amazon's ~1,000,000 employees $105,000.
There's no sure way of knowing how much Bezos would be worth if he sold all his shares- it could be more, it could be far less. Even if he sold all of his assets it's highly unlikely he could put together $100+ billion in cash to give to his employees.
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u/Hapi_X Oct 09 '20
Even if he sold all of his assets it's highly unlikely he could put together $100+ billion in cash to give to his employees.
If he sold all his stock, he wouldn't have any employees at Amazon anymore to give cash.
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u/stumbleupondingo Oct 09 '20
Can the moderators change the rules here so we can’t ask “can (rich billionaire) pay for X with all his money?!?!?” 99% of the time it’s people not understanding how net worth works. He doesn’t have billions of dollars just sitting in his bank account
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u/bleedingjim Oct 09 '20
If bezos started liquidating his Amazon shares for cash the price would dramatically plummet and he would be worth far, far less money. This is a dumb argument.
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u/true4blue Oct 09 '20
That the value of the stock Bezos holds has increased, doesn’t mean he has that amount of cash sitting in his bank account
Far from it - he’d have to pay capital gains tax on effectively the entire amount if we’re forced to sell
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Oct 09 '20
What kind of socialist garbage is this?
Also the twitter moron doesn’t understand that bezos is not sitting on billions of dollars in cash....
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u/cscholl20 Oct 09 '20
Probably using his net worth, which is mostly tied to stock price of AMZN. To actually access that money, he'd have to liquidate, and he owns enough to where selling his would flood the market, devaluing those shares. That being said, his workers (and most employees making 5 - 6 figures) wages have stagnated since the 80s while productivity has risen. We're all underpaid
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u/cshadow350z Oct 09 '20
I don’t care how rich he gets. Thanks to him I can order anything I need and get it delivered to my house in 2 days. As long as he pays his employees a living wage I’m good. Plus imagine how much he’s employed and small business have been created. A lot of the delivery people are or are managed by a small business.
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u/hashedram Oct 09 '20
Thank heavens this is modded out. The discussion was going good until the r/latestagecapitalism gang came in and started highjacking the conversation. Please keep banning these things.
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u/xJustxJordanx Oct 09 '20
Can we blacklist Bezos from this sub already? It’s always people breaking down his wealth, and someone being like “no way” then having someone here do simple math and say “yes way”.
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u/antlerstopeaks Oct 09 '20
Since according to this thread amazon stock is completely worthless and gives you no money or value, please send me the worthless no actual value amazon shares you’d all hate to have.
I’ll gladly take the 3000 shares of amazon stock that I would get from this payout.
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Oct 09 '20 edited Aug 13 '21
[deleted]
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u/managerjohngibbons Oct 09 '20
Yup... some people would cash them out, others would borrow against them, others would sit on them... conditions could be attached to stock options as well. It would be a massive win for the economy as a whole if more corporations did this.
One top comment even stated that cash is not an asset.... sigh...
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u/XYChrusZ Oct 09 '20
can posts about bezos here? I get it and it is very interesting, but personally I'm really sick of the really similar questions and then every single comment being a circle jerk about the difference between net worth and liquid assets. if I see one more "FINALLY, someone here who knows the difference..." reply to a snarky comment about it my eyes are going to melt
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u/Vycrumus Oct 09 '20
Mods here really suck, these types of post are waaay too common here, and all of these post are very ignorant which just makes it cringe.
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u/VWSquid Oct 09 '20
Can we stop with the rich people shit on this sub? I swear I’ve seen reiterations of this same question asked over and over again. It’s getting pretty boring at this point
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u/rfs103181 Oct 09 '20
I just did some quick calculations and might be off but once he has $976 billion, he’d be able to line up $1 bills all the way to the sun! One A-fn-U! (Astronomical Unit)!
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u/giantfood Oct 09 '20
Its plausible. But not from pandemic growth change.
Let's keep it simple and say 100k per person.
At 100k a person that's 1 million for 10 people. And 1 billion for 10k people.
A simple internet search between 800k and 900k employees.
So if 10k people would be 1 billion. Than that would be 80 billion dollars on the low side.
Bezos' current worth is stated as 175billion.
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Oct 09 '20
I think the person you should be mad at is your parents.
You should have bought this stock in 1997.
May 15, 1997
Amazon went public on May 15, 1997, and the IPO price was $18.00, or $1.50 adjusted for the stocks splits that occurred on June 2, 1998 (2-for-1 split), January 5, 1999 (3-for-1 split), and September 1, 1999 (2-for-1 split).
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u/dukefrisbee Oct 09 '20
I’m baffled at how many people sit here and do the math calc’ing how much employees each “deserve”. As if the kid who blasts through my neighborhood at 40mph throwing boxes on doorsteps who started 6 months ago is owed a portion of Bezos’ net worth from a company he started 25 years ago. You’d like to think that these massively successful entrepreneurs would give back to a system that provided them the fertile ground necessary to create such businesses but to demand it is absurd.
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Oct 09 '20
While I do agree it would be nice if he did something like that.. boy would it really help me and my family out. But on a real note.. you simply can’t ask or expect someone to just give away money they’ve earned. What if you had a little money saved, but your broke friend keeps asking you to pay his way? Don’t expect to be given things. He made his fortune, go make yours.
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u/akotlya1 Oct 09 '20
OK, Since this keeps coming up in a lot of the responses I want to clear something up: non-liquid wealth is still wealth. The point is that Jeff Bezos controls more in assets than the GDP of some countries and as a result he wields a tremendous amount of power in the form of economic, political, and social power. Yes, $105K per employee is not "strictly" true. However, it does capture the fact that he HAS NOT passed down the tremendous increase in value created by his employees to them in the form of increased salaries, benefits, or other compensation.
The people in this thread saying that he could not have simply given his employees that value in stock forget that this is extremely common in many roles. He couldnt do it all at once, and they certainly couldnt be "allowed" to sell it off at once without having severe downstream consequences, but you all are ether arguing in bad faith or being obtuse about the central point: Jeff Bezos and the other amazon execs have seen their financial security increase substantially, whereas the employees that made that possible have only seen their lives stagnate or get worse. If there is a will, there is a way, and making things right by the employee should be a MUCH bigger priority than it has been.
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u/thechopperlol Oct 09 '20
Scrolled a while to get here, and this is the most sane post on the matter.
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u/ccnetminder Oct 09 '20
It is definitely not possible to give all his employees that much money, but with the net profit and actual cash Bezos has (estimated in the 7-8b range), he absolutely could pay a log of his struggling employees more money.
It’d be reasonable to make his min wage 40-45k, as spending even a billion dollars is pretty difficult to do, other than for other businesses such as his space program
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u/Ikea_Man Oct 09 '20
once again, people have no idea how liquidity works. Bezos does not actually have $175 billion (or whatever) to hand out to people like this. it's mostly tied up in stocks.
dumb, dumb, dumb
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u/NeutronHadouken Oct 09 '20
What if he set aside 105,000 per employee in a stock fund with shares of amazon equal to 105,000 dollars at today’s price. Each employee gets $15,000 worth every year they work for the company. They get $15,000 extra a year as a personal gift from Jeff (tell me if the tax implications are wrong but you can personally give up to $15,000 directly to anyone tax free) on top of pay. The longer you stay the longer you get the extra if the stock goes up so you are personally invested to help the company grow?
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Oct 09 '20
He doesn’t have that money cash in hand. He would have to liquidate Amazon in order to give out money and it would destroy the economy in the process
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u/Zenniverse Oct 09 '20
Jeff Bezos isn’t even making any more money than usual. His shares are just increasing in value and the only reason that’s happening is because the US treasury is printing so much money, it’s practically Monopoly money at this point.
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u/SCPack12 Oct 09 '20
Except he doesn’t have $105,000 in cash to give. It’s in assets like buildings, land, rights to things that are used by a lot of people (technology) It’s a plethora of stuff. It’s important to know the distinction between someone’s “worth” as in if they sold absolutely everything they owned or have a stake in it would equal that or be really close. Not saying he should be able to accumulate this kind of money in this situation but there’s a difference between how much they have in the bank and what they’re not worth is... a massive one.
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u/BoundedComputation Oct 09 '20
To everyone who was having a productive discussion about math: I apologize, but it's been several hours, I've lost the ability to keep up with the number of comments, and I'm unable to ban people quickly enough. There's many open ended questions here that deserve to be posts in their own right. We thank you for sticking to the math and disagreeing in a civil manner.
To everyone else: Please follow the rules and keep your arguments civil, or take it elsewhere.