Everyone knows that in the USA there is a big gap between rich and poor, but there is a gap between rich and rich.
Take, for example, the current presidential race. Donald Trump’s fortune is estimated at $ 3.1 billion.
Huge money for almost anyone in the world. And a drop in the bucket for Trump’s new rival, Michael Bloomberg, who owns a fortune of $ 53 billion.
With proper management, large fortunes — like any investment — can grow exponentially.
Bloomberg first got on the Forbes 400 America’s richest people list in 1992 with a fortune of $ 350 million or more, when Bloomberg terminals filled international markets for stocks, bonds and more, filled Wall Street.
At that time, Trump was trying to save his empire after a series of acquisitions using borrowed capital put him on the brink of collapse.
Trump managed to recover and in 1996 returned to Forbes 400 with a fortune of about $ 450 million. By that time, Bloomberg owned approximately $ 1 billion, taking into account his share in the company collecting financial information.
Over the next 23 years, Trump’s fortune grew by 8.8% per year, which is higher than the profitability of the S&P 500 index, which amounted to 6.7% in the same period. The biggest increase in Trump’s fortune occurred from 1996 to 1997, when it increased from $ 450 million to $ 1.4 billion. Bloomberg’s wealth grew faster and much more consistently — by 18.8% per year.
Such incredible dynamics — the result of a thriving business — explains how Bloomberg became so much richer than Trump, who, apart from major deals in television and licensing, mainly managed aging real estate assets. Bloomberg LP has grown over the past decades and now, among other things, publishes news from the world of business and finance. In 2009, Bloomberg LP acquired BusinessWeek magazine from McGraw-Hill, which was experiencing difficult times, as reported for about $ 5 million and almost $ 32 million of borrowed capital. Today, Bloomberg LP’s revenue is estimated at $ 10 billion, and Michael Bloomberg owns 88% of the company. Bloomberg LP provides impressive growth.
To win in business, you need other skills than to win in politics. The following year, Bloomberg, the former three-term Mayor of New York, will have the opportunity to compete in politics with Trump. Donald Trump can only dream of resources such as his.