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Recessions have a way of focusing the mind. They also help the "uber-rich" pull up the drawbridge, says Hugh Hendry of hedge fund group Eclectica, who was on "Squawk Box Europe" this morning.
Hendry argues the mega-wealthy are strong supporters of government intervention because it is a force for leveling down and preserves the status quo. Competition is weakened and the plain wealthy are kept in check by being forced to fund public spending through higher taxes.
"Socialism levels it all out, everyone's a winner, so you stay up there in your elevated castle," he said.
(Watch the full CNBC interview with Hugh Hendry above).
While the "uber-rich" can arrange their affairs to benefit from advantageous tax regimes and will settle where the terms are most beneficial, the rest of us are grounded in economies that are struggling to fund both public spending obligations and new support packages.
And who ends up paying the cost? Thats right, not the "uber rich!"
Public cash can further help ring fence the mega wealthy by propping up the industries they are invested in -- the losses are socialized while the profits tend to get concentrated in just a few hands.
Perhaps the old saw about the "rich just getting richer" should be amended for our times. In this market just being rich won’t cut it.
Being "uber-rich ... well, know we’re talking ...
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Data is a real-time snapshot *Data is delayed at least 15 minutes