The Daily Valet. - 5/15/23, Monday
✔️ The Great Wealth Transfer
Monday, May 15th Edition
By Cory Ohlendorf, Valet. Editor
Was that weekend a little too short for you, too?
Today’s Big Story
The Great Wealth Transfer
Baby Boomers Are Passing on Trillions to Heirs ... but is that a good thing?
This really feels like one of those good news/bad news situations. An intergenerational transfer of wealth is in motion in America—and it will dwarf any of the past. Millennials are expected to hold five times as much wealth as they do today by 2030, when they're estimated to inherit over $68 trillion from baby boomers.It's being called the “Great Wealth Transfer.” That change in fortune for millennials—a generation that has been thwarted by a series of recessions, costly real estate, lack of savings and heavy student debt—has the potential to significantly change the American financial and political landscape. But for better or worse? The baby boomers capitalized on an unprecedented 40-year rally in stock and housing prices. Now, those babies are bequeathing on an equally epic level. As boomers die off, most will leave behind thousands of dollars, a home or not much at all. Others are leaving their heirs hundreds of thousands, or millions, or billions of dollars in various assets.This massive sum of money inherited by millennials will decrease inequality between the generations in the U.S. but will likely worsen it overall, experts told Newsweek. In fact, it's already impacting the broader economy—greasing the wheels of social mobility for some and leaving obstacles for those left out as the cost of living, housing and raising families surge.According to the New York Times, the wealthiest 10 percent of households will be giving and receiving a majority of the riches. Within that range, the top 1%—which holds about as much wealth as the bottom 90%, and is predominantly white—will dictate the broadest share of the money flow. The more diverse bottom 50% of households will account for only 8% of the transfers.
FYI:
Recent forecasts expect Social Security's trust funds to be depleted by 2033, around the same time when millennials are expected to inherit their parents' wealth.
Why All Eyes Are on Turkey Now
An unprecedented and pivotal election
Turkish President Recep Tayyip Erdogan and opposition leader Kemal Kilicdaroglu appear to be headed to a runoff as preliminary results show neither candidate reaching the majority of votes needed to win Sunday's election outright. A runoff round for the presidency between the two will take place on May 28 if the results are confirmed by Turkey's Supreme Election Board.According to the Washington Post, the vote marks Erdogan's toughest electoral challenge during two decades at the top of Turkish politics, and it is “effectively a referendum on the strongman leader's rule.” The results could have sweeping consequences for the nation's economy and political freedoms, as well as the balance of global power.At stake is the course of a NATO member that has managed to unsettle many of its Western allies by maintaining warm ties with the Kremlin. One of the world's 20 largest economies, Turkey has an array of political and economic ties that span Asia, Africa, Europe and the Middle East, and its domestic and foreign policies could shift profoundly depending on who wins.
FYI:
Erdogan faced mass protests against his governing style in 2013. In 2016, two years after he became president, he survived a coup attempt.
Sixty-three percent of U.S. adults plan to travel this summer. Wealthier people increasingly plan to shell out for trips while lower earners pull back, industry analysts and travel experts say.”
- NBC News on summer vacation trends
Beware of Flatcoins
Forbes calls them a complicated fad and it’s not clear whether they will actually work
Inflation has been a real menace for financial markets this year. Every time stock or crypto prices gain a little momentum, the U.S. Federal Reserve releases new consumer price index data showing ever-increasing inflation. But a new stablecoin, called the flatcoin, was promised to be the answer to raging inflation.Stablecoins are digital tokens created to mirror the value of hard currencies like the U.S. dollar. They are critical for liquidity in the $1.2 trillion crypto market because investors need a steady, predictable place to park cash—in part because bitcoin, which can swing as much as 10% in a single day, is less than reliable. Flatcoin is tied to the cost of living, so purchasing power should remain constant over time. If inflation were to rise, so would the value of this flatcoin.But Forbes warns, if they are meant to be the next evolution of digital “safe money”, stablecoin's biggest players have yet to sign on. And flatcoins are so new they do not yet appear in any of the current stablecoin regulation bills circulating around Capitol Hill. Forbes called various legislators and regulators involved with the recently proposed stablecoin legislation to ask about flatcoins, but most hadn't even heard of them yet.
Meanwhile:
Central banks and sovereign governments around the world are calling for the launch of central bank digital currencies.
Celebrity Gin Is the New Move
If Ryan Reynolds can make it big with gin, why not a slew of other celebrities?
For a while, it seemed like every other celebrity was launching a tequila brand, didn't it? But that's apparently over. Now, it's all about gin. And why not? If Ryan Reynolds can make it big with gin, why not Snoop Dogg?Yep, he's got one (which, no doubt mixes perfectly with juice). And Brad Pitt just introduced The Gardener gin with the help of former Tanqueray master distiller Tom Nichol. It's a London Dry Gin, crafted from wheat in copper stills, made to capture the soul of the French Riviera in all its boozy glory.And speaking of French gin, Emma Watson has paired up with her brother to launch Renais Gin. Thanks to the family's deep ties to winemaking, they're distilling this gin from the byproducts of the winemaking process instead of grain, including upcycled French Chablis grape skins.
FYI:
At Ryan Reynold's new Aviation American Gin Distillery, guests can tour and get the full gin making experience.
In Other News
Biden proposal would let them lease public land much like oil drillers and ranchers.
Have you heard about ...
The Coffee Lover’s Preferred Method
Do you pour over? Because we found the best ones on the market today
Getting out of bed is never an easy task, but getting up to brew your favorite coffee is all you need to cure those morning alarm clock blues. Coffee is the gift that keeps on giving—from that familiar smell when you grind your beans to the nuanced taste, along with that much needed punch of energy that caffeine delivers. There's no better way to kickstart your day. There are several ways to brew your bean broth, but one of our favorites is the pour-over method.Our own Leon Hedgepeth dove in and found the best pour-over setups on the market today, from simple cones over a mug to a fancy one-touch button brewer, there's one to suit any coffee lover's caffeine routine.
Get It:
The eight best pour-over coffee makers you can buy.
Shopping
What We’re Buying
Kaloula Trousers
These pants have menswear dudes talking. The first product from upstart British label Palfrey Heights, they have a laidback vibe and a relaxed drape, but that's not by chance. The pants ($210) feature a series of expertly tailored darts that are stitched into the trousers—both at the waist and coming up from the ankle. They help the pants have a certain voluminous quality, while also sitting right where you want them at the waist (and not puddling over your shoes). They come in two shades, “Olivine” and “Petrol Blue,” and frankly either would look great.
Want More?
The five stylish items you should buy this week.
Morning Motto
Acceptance is key.
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