The rich are spending more--on themselves as well as others.
With the explosion of wealth in the U.S, more people are spending unheard of sums on homes, vacations and other luxuries--including outdoor fireplaces. But they're also spending their new-found wealth on charitable causes. And sometimes, they use their wealth to squabble over a hedge--yes, a hedge--dividing their estates in the Hamptons.
Here's a sampling of some of the stories CNBC has been covering this week on the trend.
More Are 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.
Weill: Charity Is More Than Money
In the latest example of big donations, Weill Corner Medical College announced on Wednesday that Sandy Weill, former Citigroup chairman and CEO, and his wife, Joan, had donated $250 million. An anonymous donor kicked in another $100 million; Maurice “Hank” Greenberg added $25 million and the Starr Foundation, which Greenberg oversees, added another $25 million to the gift.
Sandy Weill, former Citigroup chairman, told CNBC that philanthropy isn’t just about money.
In an interview with CNBC's Mary Thompson, Weill said giving is about your talent and passion. He urged others to start giving when they’re young and before they have money. He said it’s important to give of your intelligence, energy and passion.
Weill and his wife, Joan, donated $250 million to the Weill Cornell Medical College. He says the money will be used to build a new research facility in New York and to recruit 100 scientists who will focus on diabetes, obesity, cancer and problems of aging such as Alzheimer’s disease.
The reward is working with “really bright people” and showing those in need that “they’ll have a good chance to have a better life.”
Golfers Invest in Paradise
Tiger Woods and Ernie Els go toe-to-toe at this weekend's U.S. Open near Pittsburgh, but the golf greats are partners in a real estate development in the Bahamas, CNBC's Scott Wapner reports.
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.”
Wapner says 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.”
The Ultimate Fireplace
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.”
Hedge Row in the Hamptons
A burning question in the Hamptons, the tony beach towns on Long Island, is: Who’s the hedge hog?
Hedge fund king James Chanos, of Kynikos Associates, and Marc Spilker, a managing director at Goldman Sachs, are squabbling about a common path to the beach, according to CNBC's Margaret Brennan.
The path is bordered by a row of six-foot-high hedges--or at least it was until a bulldozer knocked them over like drunken sailors.
Chanos accuses Spilker of flattening the greenery to widen the path to the Atlantic. Both have a legal right to the path, Brennan says.
Spilker’s lawyer cites a 1969 regulation that says the path must be 15 feet wide. He claimed that Chanos “has been unwilling to rationally discuss the situation.”
Chanos’ legal team counters that a 1982 document requires the path to be only four feet wide. “The use of the bulldozer on the property is a trespass,” Chanos' attorney huffed.
Hamptonite Steven Gaines says such landscaping spats occur often among habitués of the multi-million-dollar estates.
There's an added complication: Chanos’ hedge fund has about $3 billion stashed at Goldman Sachs.