There's been an explosion of wealth creation in the U.S. in recent years. But it's not about trickle-down economics. It's more a matter of gusher-up capitalism, rivaling the days a century ago when business barons such as Carnegie, Ford and Rockefeller built empires and fortunes. Microsoft founder and entrepeneur-turned-philantrophist Bill Gates has actually managed to amass a fortune rivaling those of that gilded age.
The stock and real estate markets -- at least until recently -- soared for years, creating billions in wealth. Forget about CEO pay. What's a $200-plus million severance package for the head of a Dow 30 component, when hedge fund managers are routinely making that kind of money in a year. Three made a billion dollars or more last year. The high-flying world of private equity is also creating billions in income.
Counting The Ways
As Scott Cohn reports, there are now 946 billionaires in the world, according to Forbes Magazine, about 19% more than a year ago. In the U.S., the top 1% of the population now holds 22% of the nation's income.
And all that money has to go somewhere. After you've given away millions -- indeed, in rare cases, billions -- to charity, there's still cash to spend. And there's plenty of companies looking to help. In our special report, we take a look at some of those companies as well as other ways to spend a fortune -- whether it is autos, jewelry, dining, housing or vacations.
Peaceful Zen Garage
Many a successful entrepreneur has started his empire in a garage, but you wouldn't expect the wealthy to deem them a retreat.
Enter Harris Laski, a real-estate developer and classic-car enthusiast, who has combined business and pleasure -- creating blissful garage retreats for his prized possessions.
CNBC's Jane Wells reports that he has built several garages on or near the Pacific Palisades, totaling 7,000 square feet.
With posh details like French doors that open vertically, Laski says he "designed them like homes." The accompanying greenery creates great tranquility: "Having your cars next to a garden makes it feel like everything belongs together."
Lexus Goes For Six Figures
Lexus is the top-selling luxury auto brand, thanks to the IS, ES and LS models being popular among buyers willing to spend $30,000 and $75,000 on a vehicle. Overall, luxury sales have more than doubled since 1999 to 1.9 million units.
Now Lexus wants a piece of the growing upper end of the luxury market, where Mercedes and BMW sell vehicles for more than $100,000.
As Phil LeBeau reports, Lexus is taking a calculated approach to its quest by studying what car lovers want.
It turns out that the super rich who can afford $100,000 cars usually have several of them. But any car in that class has to be distinctive.
So, Lexus is trying to stand out by emphasizing technology. Its new LS 600 is an eight-cylinder hybrid that delivers 12-cylinder performance.
Jewels Of The Crown
It's easy to spend a fortune on jewelry -- one piece at a time.
These days, items costing $20,000 and up are the fastest growing category of jewelry for Cartier, Tiffany and Bulgari. And suddenly the hottest market in the luxury business is the U.S.
As Margaret Brennan reports, Italy's Bulgari has targeted the U.S. for aggressive expansion. The U.S. already accounts for 30% of the company's sales, but the Rome-based company just refurbished its flagship New York City store and plans additional ones. The company is also considering expanding into malls and high-end department stores.
Richemont's Cartier and Tiffany are also expanding. Tiffany, for instance, plans five to seven stores in the Midwest -- all 5,000 square feet.
Sacks is looking to create branded jewelry, working with the likes of Chanel and Gucci to compete in the lucrative market.
Paradise And Lunch
Building Couture Mansions
A mansion (or two) with all the trappings comes with the territory when you're rich, never mind super rich. But building your own castle takes time -- 48 months, by one estimate -- and who has the time or interest in dealing with architects, builders, designers and local authorities.
Enter Antares Investment Partners, which will do it all for you. In fact, it's building several homes on spec.
It's called couture-ready real estate. And what better place to launch the concept than Greenwich, Conn., the hedge fund capital of America and home to many a multi-million dollar home.
The company will build you a masterpiece. The firm's largest property is a $25 million, 41,000 square-foot complex.
Diana Olick met with Antares founder Joseph Beninati and checked out the mansion.
Let's Do Lunch (For $100,000)
In a world of exclusive restaurants of the moment and lavish expense-account meals, those looking for a taste of something particularly luxurious and expensive have a new choice on the menu.
As Jane Wells reports, corporate entertaining veteran Billy Harris, master mixologist Tony Abou-Ganim and celebrity chef Mario Batali will throw you the ultimate lunch or dinner for $100,000, plus expenses. Among other things, you'll get a cocktail named after you and a customized multi-course meal, but you'll have to book well in advance.
IBM, for one, has, taken the plunge.
Golfers Invest in Paradise
Tiger Woods and Ernie Els may be rivals on the links but they are partners in a real estate development in the Bahamas.
The new community for the super-rich, backed by the private equity firm Tavistock Group, offers 350 homes and luxury apartments ranging in price from $4 million to $20 million.
“It’s a great get-away,” Els says. “It’s close to the U.S. – not a lot of time zones you have to cross – and it’s almost like being in Florida.”
As Scott Wapner reports, the development comes with amenities worthy of a five-star resort, including a 17-acre marina, a water park for the kids, five-star dining and – don’t forget your clubs – a championship golf course designed by Els.
“It’s a complete community,” says Clarence Otis, chief executive officer of Darden Restaurants. “Really designed for families – intergenerational – which was appealing to us.”
Fireplace sales are on fire, reports CNBC’s Jane Wells.
They’re popping up everywhere, she said, even in the coldest climates of the Midwest and Northeast.
“From the beginning, we realized if the outdoor is going to be an extension of the indoor, that a fireplace made perfect sense,” a homeowner told Wells.
While some communities are trying to restrict outdoor fireplaces in order to limit smoke and potential hazards, homeowners argue that they help bring kids away from their iPods and TV sets and back “to do something humans have done as long as we’ve had fire: circle around it.”
Giving It Away
Philanthropy--once the province of "old money," or those who inherited their wealth--is increasingly being led by self-made millionaires and billionaires, according to CNBC's Mary Thompson.
And the size of gifts is getting bigger as Wall Street’s profits rise.
“It used to be that $10 million was considered a big gift,” says Stacy Palmer, editor of Chronicle of Philanthropy. “These days, you have to give at least $100 million to get noticed.”
Last year’s major donors included investor Warren Buffett, $43.56 billion; David Rockefeller, former chairman of Chase Manhattan Bank, $252 million; Robert Wilson, retired hedge fund manager, $147 million; Dan L. Duncan, founder of Enterprise Products, $115 million; and Nike Chairman Phil Knight, $105 million.
Thompson says many hedge fund managers are active in the field, but most are reluctant to attach their name to their gifts.