Why is Bill Gates still so rich?

"Forbes is out with its list of the world's top billionaires, and Bill Gates is once again at the top of the list. His $76 billion puts him ahead of Mexico's Carlos Slim ($72 billion) and Amancio Ortega ($64 billion)."

I am confused. Why is Bill still so rich while he continues donating huge amount of his money to charity? Now he is everything: American business magnate, philanthropist, investor, computer programmer, and inventor. He even talked about giving all his money away and continuing to be the richest person on earth, good will pays??

When you are that rich you can afford to give millions even billions to charity and still be ridiculously rich.

Even at a poor rate of return he makes billions a year on his money.

Bill Gates' wealth comes from:

Shareholder in Microsoft - 338 million shares at $41 / share or about $13 billion.
Sole Owner of Cascade Investments - the rest. You can attempt to figure out his holdings, but I trust Forbes' finding of the other $63 billion. Over time, he has sold off the bulk of his MSFT shares, paid the taxes, and invested it in his company.

When the capital gains tax is only 15%, it's pretty easy for rich people to retain their wealth.

I just saw that he has donated an estimated $28 billion to charity so far. He gets a lot of attention for promising to donate nearly all of his fortune when he dies.

There is supposedly a point at which you can't get rid of it as fast as it amounts. Guess he found that point, at least as far as his current holdings are concerned.

Quote: beachbumbabs

There is supposedly a point at which you can't get rid of it as fast as it amounts.

What would it take for the U.S. government to reach that point?

If Bill and Warren decided to pay off the National Debt, how long would THAT take?

He has a family that loves him.

Quote: JimRockford

What would it take for the U.S. government to reach that point?

A president with a proven track record as a successful businessman. Bill Gates, Warren Buffet, Sheldon Adelson, Jeff Bezos, Larry Page. These types of people should be our Presidential Candidates, not career politicians.


ZCore13

+1...

Quote: Zcore13

A president with a proven track record as a successful businessman. Bill Gates, Warren Buffet, Sheldon Adelson, Jeff Bezos, Larry Page. These types of people should be our Presidential Candidates, not career politicians.


ZCore13

You realize how successful the US has been electing businessmen right. There was Bush Jr, largely considered a failure. There was Carter a failure. There was Hoover, Coolidge, and Harding. None of these people are ranked anywhere near top for presidents. Running a country is significantly different than running a business.

Quote: Twirdman

You realize how successful the US has been electing businessmen right. There was Bush Jr, largely considered a failure. There was Carter a failure. There was Hoover, Coolidge, and Harding. None of these people are ranked anywhere near top for presidents. Running a country is significantly different than running a business.

I don't know how many of those took over the reigns or actually built it themselves. I did not include any of the Walton kids (Walmart) because they fell into their billions. I'm looking for people who specifically started with nothing and built an empire.

ZCore13

Quote: Zcore13

I don't know how many of those took over the reigns or actually built it themselves. I did not include any of the Walton kids (Walmart) because they fell into their billions. I'm looking for people who specifically started with nothing and built an empire.

ZCore13

Only modern contenders would be H Ross Perot and 2nd gen Steve Forbes. Either one was not acceptable, apparently, though I think Perot might've surprised us.

Though honestly, you probably should count the Wal-kids, cuz Sam died 22 years ago, and they comPletely changed his game plan.

Quote: 98Clubs

If Bill and Warren decided to pay off the National Debt, how long would THAT take?

The combined wealth of the Forbes’ 2013 ranking of the richest people in America (“The Forbes 400) is $2 trillion.

So, forever, is a good estimate.

As of May 16, 2013, Bill Gates had donated US$28 billion to the foundation. So that is less than $2 billion a year. A man with that kind of wealth can give away $2 billion a year out of his earnings without decimating his fortune.

Quote: pacomartin

As of May 16, 2013, Bill Gates had donated US$28 billion to the foundation. So that is less than $2 billion a year. A man with that kind of wealth can give away $2 billion a year out of his earnings without decimating his fortune.

and still maintains his position as the #1 richest person on the planet. I wonder how señor Carlos Slim Helu thinks...

Carlos? He climbed the ladder in the 2000's, OOPS, 2008, sorry 'bout dat. AMX/Tracfone/Telmex ain't been the same since, and he had to diversify into basic materials and construction. Its still a good thing to be in the top 10 (last I knew).

I'm told that Bill Gates plays 2/4 and 3/6 limit hold em. Obviously that's the main source of his income.

He also plays bridge. I keep hoping I'll draw him as a partner, but probably he gets to pick everyone he plays with and against. He and Warren Buffett partner sometimes.

Quote: UCivan

I wonder how señor Carlos Slim Helu thinks...

Carlos Slim Helu has a four-year run as world's richest person (now #2) .
Shares of Minera Frisco, his mining company, have fallen more than 50% in the past year as the price of gold and copper plummeted.
He is the only billionaire among the world's 10 richest to get poorer in the past year.
America Movil has 70% or more market share of both the landline and mobile markets in Mexico, but the company has come under pressure in Mexico after the passage of a new anti-monopoly telecom and media law.

Still, Carlos Slim is one of 5 people that have stayed in the top 20 since they began the list 28 year ago. Of course, Brin and Page were in Junior High. Sam Walton died in 1992 before they started making worldwide lists.

Billionaire list 2014
1 Bill Gates $76.0 United States Microsoft 58
2 Carlos Slim Helu & family $72.0 Mexico telecom 74
3 Amancio Ortega $64.0 Spain retail 77
4 Warren Buffett $58.2 United States Berkshire Hathaway 83
5 Larry Ellison $48.0 United States Oracle 69
6 Charles Koch $40.0 United States diversified 78
6 David Koch $40.0 United States diversified 73
8 Sheldon Adelson $38.0 United States casinos 80
9 Christy Walton & family $36.7 United States Wal-Mart 59
10 Jim Walton $34.7 United States Wal-Mart 66
11 Liliane Bettencourt & family $34.5 France L'Oreal 91
12 Stefan Persson $34.4 Sweden H&M 66
13 Alice Walton $34.3 United States Wal-Mart 64
14 S. Robson Walton $34.2 United States Wal-Mart 70
15 Bernard Arnault & family $33.5 France LVMH 64
16 Michael Bloomberg $33.0 United States Bloomberg LP 72
17 Larry Page $32.3 United States Google 40
18 Jeff Bezos $32.0 United States Amazon.com 50
19 Sergey Brin $31.8 United States Google 40
20 Li Ka-shing $31.0 Hong Kong diversified 85


Billionaire list 1996
1 Bill Gates $18.5 United States
2 Warren Buffett $15.0 United States
3 Paul Sacher,Oeri and Hoffman, Family $13.1 Switzerland
4 Lee Shau Kee $12.7 Hong Kong
5 Tsai Wan-lin, Family $12.2 Taiwan
6 Kwok, Brothers $11.2 Hong Kong
7 Li Ka-shing, Family $10.6 Hong Kong
8 Tsutsumi, Yoshiaki $9.2 Japan
9 Albrecht, Theo and Karl $9.0 Germany
10 Rausing, Hans and Gad $9.0 Scandinavia
11 Quandt, Johanna, Susanne and Stefan $8.1 Germany
12 Haniel, Family $8.1 Germany
13 Allen, Paul $7.5 United States
14 Thomson, Kenneth $7.4 Canada
15 Kluge, John Werner $7.2 United States
16 Tan Yu $7.0 Philippines
17 Wonowidjojo, Family $6.7 Indonesia
18 Carlos Slim Helu $6.1 Mexico
19 Larry Ellison $6.0 United States
20 Chung Ju-yung, Family $5.9 Korea
21 Mulliez, GTrard $5.7 France
22 Kuok, Robert $5.7 Malaysia
23 Kwek Leng Beng, Family $5.7 Singapore
24 Cheng Yu-tung, Family $5.5 Hong Kong
25 Haefner, Walter $5.5 Switzerland
26 Knight, Philip Hampson $5.3 United States
27 Otto, Michael $5.2 Germany
28 Fong, Teng $5.2 Hong Kong
29 Ng, Robert $5.2 Hong Kong
30 Takei, Yasuo $5.2 Japan
31 Ermfrio de Moraes, Antonio $5.1 Brazil
32 Widjaja, Eka Tjipta $5.1 Indonesia
33 Bettencourt, Liliane $5.0 France
34 Merck, Family $5.0 Germany
35 Berlusconi, Silvio $5.0 Italy
36 Bin Mahfouz, Mohamed Salim $5.0 Saudi Arabia
37 Lee Kun-hee, Family $4.9 Korea
38 Walton, John T. $4.8 United States - (died 2005) wife is Christy Walton
39 Walton, Jim C. $4.8 United States
40 Walton, Helen Robson $4.7 United States (widow of Sam, died 2007)
41 Walton, Alice Louise $4.7 United States
42 Walton, S. Robson $4.7 United States
43 Henkel, Family $4.6 Germany
44 Son, Masayoshi $4.6 Japan
45 Flick, Friedrich Karl Jr. $4.5 Germany
46 Liem Sioe Liong, Family $4.5 Indonesia
47 Landolt, Family $4.5 Switzerland
48 Newhouse, Donald Edward $4.5 United States
49 Newhouse, Samuel Irving Jr. $4.5 United States
50 Chearavanont, Dhanin $4.2 Thailand

Quote: boymimbo

When the capital gains tax is only 15%, it's pretty easy for rich people to retain their wealth.

And you have to sell to have capital gains.

An unspoken element of the current debate about the 1% just getting richer all the time no matter what, is whether or not a person's unrealized wealth can be taxed.

In other words, a certain form of state seizure of private property almost seems necessary or our current "income inequality" will persist. Income tax doesnt seem to get it done. The 15% on c. gains is part of the problem, but not all of it. Furthermore, for many, many retirees it would be crippling to raise it substantially. So, I believe, a means test is being considered. Someone like Mitt Romney or Warren Buffet would have to report his total wealth, establish that he is a rich bastard, and get nailed for double the capital gains rate [or sumesuch]. Maybe even be forced to sell assets.

That ... seizure of assets, or forced liquidation of assets... in the past has been considered the difference between extreme Socialism and actual Communism.

Quote: Lemieux66

I'm told that Bill Gates plays 2/4 and 3/6 limit hold em. Obviously that's the main source of his income.

I've heard he also plays $5 blackjack (I think it's been posted on here). Could you imagine playing BJ with him or poker?

Quote: RS

I've heard he also plays $5 blackjack (I think it's been posted on here). Could you imagine playing BJ with him or poker?

Pretty sure he wouldn't be concerned with surrendering or taking insurance lol

Quote: beachbumbabs

There is supposedly a point at which you can't get rid of it as fast as it amounts. Guess he found that point, at least as far as his current holdings are concerned.

Andrew Carnegie had some of this kind of problem, and he would make Gates look like a bum on Freemont St.

I can say that when a nonprofit has too much cash it is worse not better. The people running it waste cash, they lose track of their mission, and they act like they are just there to hand it out. The Salvation Army tries to spend most of what they take in each year to avoid this, when Ray Kroc's widow left them a bundle they could not use it fast enough and had to break their by-laws because they did not want to spend just to spend thought they also did not want to become a trust-fund baby.

Quote: odiousgambit

And you have to sell to have capital gains.

An unspoken element of the current debate about the 1% just getting richer all the time no matter what, is whether or not a person's unrealized wealth can be taxed.

In other words, a certain form of state seizure of private property almost seems necessary or our current "income inequality" will persist. Income tax doesnt seem to get it done. The 15% on c. gains is part of the problem, but not all of it. Furthermore, for many, many retirees it would be crippling to raise it substantially. So, I believe, a means test is being considered. Someone like Mitt Romney or Warren Buffet would have to report his total wealth, establish that he is a rich bastard, and get nailed for double the capital gains rate [or sumesuch]. Maybe even be forced to sell assets.

That ... seizure of assets, or forced liquidation of assets... in the past has been considered the difference between extreme Socialism and actual Communism.

So are you asking for a tax on the growth in wealth year over year for those with a certain amount of wealth? Would it be on all items not defined as current income...in other words, you had $2 billion last year and now you are worth $3 billion with no current W-2/1099-type income?

So now I pay taxes, 15% on the $1 billion and my adjusted wealth going into the next year is $2.85 billion. This is a bad year and my wealth (again, with no income from work) drops to $2.35 billion...I lost $500 million. Do I now have a $500 million tax loss? How do I use that loss against future gains? Carry-over losses maybe?

Is it socialism, communism, or just making a person report gains/losses and be taxed accordingly? If you are only taxing the paper gains/losses and not taking away the wealth I've already paid taxes on it, you aren't seizing my wealth...just making me report gains/losses now instead of when realized.

Because he does not gamble.

Quote: RonC

So are you asking for a tax on the growth in wealth year over year for those with a certain amount of wealth?

not I.

Quote: RonC

Would it be on all items not defined as current income...in other words, you had $2 billion last year and now you are worth $3 billion with no current W-2/1099-type income?

Unliquidated wealth in assets is not touched. There are property taxes. Some want at more of it.

Quote: RonC

Is it socialism, communism, or just making a person report gains/losses and be taxed accordingly?

Taxing unrealized gains and losses is mostly not done at all. There are property taxes; nothing similar though for stocks, bonds.

Yes, it is Communism to take from the rich in this manner. Gates, say, has x millions in income that is taxed at some rate leaving him with y income. But he is worth billions. Very socialist impulses say get even more of his income than we would take from a modestly wealthy person base on the fact of his total worth. A totally communist idea would be to see that his total wealth is actually reduced by more than his income [beyond reasonable property taxes]. Revolutionary communism would go for seizing it all. [edits]

The anticommunist view is that the money is "taken". The communist view is that it is shared.

Bill Gates made a ton of money building Microsoft, and unlike others he cashed out a significant portion of stock of which he rolls into his investment firm. He makes more money than he donates, albeit he donates a lot. He's been incredibly smart and lucky and ballsy at the right time. Good for him. I applaud.