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June 25, 2014
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How did the rich react to the 2008 financial crisis?

Mike Dolan of Reuters finds they started hoarding massive amounts of cash:

Estimates of the amount of cash that non-financial U.S., European and Japanese companies are sitting on is as high as $5 trillion — twice the levels of 10 years ago as capital expenditure and investment has largely seized up. A pick up in mergers and acquisitions this year is modest by comparison with bloated balance sheets. [Reuters]

Dolan points to a recent survey, which shows rich investors are storing a humongous 27 percent of their portfolios in cash — a greater amount than they held in any other asset class — including stocks, bonds and real estate — and double pre-crisis levels.

Hoarded cash loses purchasing power due to inflation. But that is a price worth paying for keeping wealth in a liquid and mobile form, which cash is.

Dolan argues that fear of higher taxation due to rising inequality is what is bugging corporations and the ultra-rich. That may be one motivating factor, but a larger one seems to be that the 2008 collapse unleashed deep and lingering fears of investment in general and the stock market in particular. With bond prices having remained ultra-high for years, and with stock markets having recovered from the 2008 crisis, and now making new highs, investors — who want to buy cheap and sell expensive — just don't see much that looks cheap to buy.

This has driven some investors and firms into alternative (and bubbly) markets like gold, Bitcoin, fine art, and London, Dubai and New York real estate, but the vast bulk is just sitting as cash, waiting for better opportunities to appear. John Aziz

12:24 p.m. ET
Tiziana Fabi/Getty Images

Pope Francis said in an interview Sunday it would be unwise to judge President Trump so soon after his inauguration, declining to offer an assessment of the new U.S. administration until more time has passed. "I think that we must wait and see. I don't like to get ahead of myself nor judge people prematurely," Francis said. "We will see how he acts, what he does, and then I will have an opinion. But being afraid or rejoicing beforehand because of something that might happen is, in my view, quite unwise."

The pope also issued a warning against turning to magnetic, populist "saviors" in times of fear. "Crises provoke fear, alarm," he mused. "In my opinion, the most obvious example of European populism is Germany in 1933. ... A people that was immersed in a crisis, that looked for its identity, until this charismatic leader came and promised to give their identity back, and he gave them a distorted identity, and we all know what happened." Bonnie Kristian

12:12 p.m. ET

Kansas City Royals pitcher Yordano Ventura and former Atlanta Braves, Cleveland Indians, and Arizona Diamondbacks infielder Andy Marte both died in separate car crashes in the Dominican Republic on Sunday.

Just 25, Ventura signed with the Royals in 2008 and finished sixth in the American League Rookie of the Year Award voting in 2014. Marte, 33, was reportedly driving alone when he crashed around 3 a.m. He played seven Major League Baseball seasons, mostly with Cleveland. Bonnie Kristian

11:42 a.m. ET

When President Obama arrived in Washington as a freshman senator from Illinois in 2005, he left an annual income of less than $100,000 from his work in the state Senate and as a professor at the University of Chicago Law School. Over the course of his 12 years in the District — four in the Senate and eight in the White House — Obama earned about $20 million, mostly from book deals and his government salary. Here's the breakdown from Forbes:


(Forbes)

Michelle Obama, who worked as a lawyer and in Chicago's City Hall before becoming first lady, is herself worth an estimated $11 million, the bulk of which also comes from a trio of lucrative book deals. Bonnie Kristian

11:13 a.m. ET

Kellyanne Conway, counselor to President Trump, said Sunday that White House Press Secretary Sean Spicer did not lie when he claimed Saturday that Trump's inauguration boasted "the largest audience to ever witness an inauguration, period," despite evidence to the contrary.

As Meet the Press host Chuck Todd repeatedly demanded that she explain why Trump would ask Spicer to tell a falsehood, Conway brushed aside his concern. "You're saying it's a falsehood," she said, but actually Spicer simply "gave alternative facts."

"Wait, 'alternative facts'?" Todd sputtered in disbelief. "Look, alternative facts are not facts. They're falsehoods." From there, Conway shifted the discussion to a list of statistics about the state of the nation before suggesting there is no way to really know the truth about the size of the inaugural crowd because "we all know" that type of math is impossible. Watch her comments in context below. Bonnie Kristian

10:46 a.m. ET

The new White House press secretary, Sean Spicer, insisted Saturday that Friday's inauguration hosted "the largest audience to ever witness an inauguration, period," accusing the media of "intentionally" framing photos to make the crowd look smaller. President Trump made the same accusation during his speech at CIA headquarters Saturday, claiming the press reported 250,000 people attended rather than the "million and a half" he personally observed.

On Sunday, White House Chief of Staff Reince Priebus argued that to focus on White House complaints about media reports on the size of the crowd is to miss the point. "President Trump said in his inaugural address that every decision he makes will be to benefit American families. How does arguing about crowd size do that?" asked Fox News Sunday host Chris Wallace. "Because it's really not about crowd size," Priebus answered. "It's about honesty in the media ... [which] from Day One has been talking about delegitimizing the election, talking about the Russians, talking about everything you can imagine except the fact that we need to move this country forward."

Despite his own protests, Priebus soon brought up aerial comparisons of the crowds at President Trump's inauguration and President Obama's event in 2009. "Well, there's another issue here, though, Reince, and that is the president's honesty," Wallace said, pulling up the side-by-side pictures, "because two things that he said yesterday were just flat wrong" — namely his discussion of crowd size and the acrimony between Trump and the intelligence community that Trump now says is a media invention. Watch Priebus' reply, and their full conversation, below. Bonnie Kristian

10:05 a.m. ET

President Trump responded Sunday morning to the hundreds of Women's Marches held Saturday in cities across the country and around the globe to protest his election. He began by suggesting the protesters should have simply voted against him and then accepted the election results.

An hour and a half later, Trump added a second post with a more conciliatory tone:

Interspersed between those two tweets, Trump said he had a "great meeting at CIA Headquarters" Saturday with "long standing ovations" and noted that his inauguration drew 11 million more television viewers than President Obama's 2013 event. Trump did not mention that Obama's 2009 viewership outpaced his own. Bonnie Kristian

9:01 a.m. ET

Saturday Night Live took a second flight of fancy into the mind of President Trump's White House counselor and former campaign manager, Kellyanne Conway, this time envisioning her celebrating her newfound celebrity à la Roxie Hart from the Broadway musical Chicago.

The skit repurposes the character's solo number, "Roxie" (you can see Renée Zellweger's performance from the 2002 Chicago film here if you need a refresher), to imagine Kate McKinnon's Conway gleefully reveling in her own fame. "The name on everybody's lips is going to be Conway," she sings, "And when the world goes up in flames, at least for now they knew my name!" Watch the full song below. Bonnie Kristian

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