Why Billionaires Try So Hard To Look 'Poor'

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My Other Channel: @howhistoryworks

Edited By: Andrew Gonzales

Music Courtesy of: Epidemic Sound

Select Footage Courtesy of: Getty Images

All materials in these videos are for educational purposes only and fall within the guidelines of fair use. No copyright infringement intended. This video does not provide investment or financial advice of any kind.

#billionaire #PovertyPeacocking #business

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Billionaires are not like you or me, but it’s really important for them that you think they are…

So important in fact that some of them are now spending millions of dollars every year to PR agencies to spread the message that they are just regular people that drive regular cars, eat at regular restaurants, and live in regular homes. But in the age of flex culture why are these people trying so hard to look normal?

The now convicted fraudster Sam Bankman Fried once had billions of dollars of customer funds at his disposal to live a lavish life in the Bahamas. In the early days of FTX Fried and his co-conspirators reportedly drove around in the expensive sports cars typical of crypto bros.

According to evidence presented during his trial, SBF would later sell these cars and advise other executives at FTX and Alameda to do the same because it didn’t fit with the image of the company that they were trying to present to customers and investors.

SBF’s shitty Toyota Corolla that paid influencers made such a big deal of was about as authentic as the companies internal accounting department.

The car, the haircut and the wrinkled haircut were more carefully managed than customer funds.

The group did this because they knew that the image of a boy genius that didn’t care about luxuries or power would be appealing to people looking for an honest place to keep their funds.

SBF and the rest of the gang were all frauds, but putting a lot of effort into crafting a folksy image is done by most prominent business leaders for three simple reasons that are mostly bullshit. If you know these strategies, you will be able to see through what is little more than personal marketing. The first reason that they do it is because even if they AREN’T running a fraud, acting like an everyman is still gets people to give them what they want.

Stealth wealth is when rich people buy products that are of high quality but does not flaunt their wealth.

They do this because they don’t want the attention and problems that come along with people knowing they are rich.

Billionaires doing a Bloomberg or NAS Daily interviews featuring their basic car and geeky wardrobe in NOT the same thing as stealth wealth! It’s not stealth wealth, so let’s call poverty peacocking and it’s a great move for their personal brand and any companies they represent.

Humble CEOs are the new fashion, the worlds biggest companies are run by men who wear hoodies and turtlenecks instead of tailored suits and other business leaders are trying to emulate that trend because investors like it. If business leaders very publicly give up flashy luxuries it also sends the message that they will be frugal running their business and the data actually backs this up.

According to a study conducted by the National Bureau of Economic Research in 2012 CEO’s and CFO’s who were not frugal in their own spending were more likely to have instances of insiders perpetuating fraud and were more likely to push equity-based incentives to increase their own income. The study separated personally frugal and flashy executives by looking for purchases like a personal car that was worth over seventy-five thousand dollars or a boat that was over twenty-five feet.

Buffett does own an old beat-up car, but he is usually driven around in a fleet of suburban’s with his security team, Zuckerburg wears the same grey shirt every day, but they are custom made by Brunello Cuccinelli, Musk does rent a tiny home next to the SpaceX factory but the Wall Street Journal pointed out that he spends most of his time in an eight thousand square foot [8,000 Sqft] twelve million dollar [$12,000,000] mansion and all of these men fly private. They are welcome to these luxuries; it is their money, but there are still two more reasons why they try so hard to pretend that they don’t exist.

So it’s time to learn How Money Works to find out why billionaires spend millions, to try and convince us that they spend nothing.

[Kushagra.j]

One of life's classic Ironies. Billionaires trying to live like Brokies & Brokies attempting to live like Billionaires

[ChickenPizza]

I remember seeing something claiming that Warren Buffet clips coupons and I couldn't help but laugh. What a ridiculous notion. If I was a billionaire, I wouldn't even buy my own groceries, let alone waste my time clipping coupons for them. What a load of horseshit.

[rainacherienne]

“Get rich quick schemes are run by poor people pretending to be rich people pretending to be poor people” 😂😂 perfect 😂

[wertywerrtyson]

At my previous job the CEO called me greedy and egotistical when I wanted a raise from earning 10 bucks an hour. Claiming that I got more money than he did as he didn’t even take a salary from the company. But I could see that his car had 7000 dollar rims. Something I could never afford. He acted poor to not have his workers demand more.

[instantsus_]

it’s not that hard to realize it’s not a good idea to make people envy you.

[jesavius]

Like Chris Rock said. If the general public really knew how rich these people are, there would be blood in the streets.

[tonysilke]

They don’t care about how they look, Being visibly wealthy can attract attention, both positive and negative. Some billionaires prefer to avoid unnecessary public scrutiny or judgments that may come with conspicuous displays of wealth. They only spend on things that yields returns for them

[Magic_beans_]

Point 3 is important: saying the CEO gets paid 200x what the media worker does is too abstract for folks to really get worked up about. What’ll hit home is an example of the CEO spending the average worker’s annual salary on something frivolous.

[DirtSweatGears]

Say this louder for the people in the back... "After a certain point, people can't improve their personal financial situation by being more frugal. They need to increase their income"

[appa]

If I were a billionaire I'd definitely walk around in power armour.

[joepiekl]

I remember reading about a French multimillionaire who was having financial difficulties successfully arguing in court that his Rolls Royce was a necessary business expense because he was selling luxury champagne and it was important for him to be able to sell that image.

[HannahMegan-ufsh]

The problem we have is because Most people always taught that " you only need a good job to become rich. These billionaires are operating on a whole other playbook that many don't even know exists.

[jamesodell]

"You'd be surprised how much it costs to look this cheap!" – Dolly Parton

[steverogers]

And it works too! So many people fall for it and the whole “cult of personality” thing influences folks to even defend these billionaires.

[MaggiDaC]

My freshman year college, a totally normal guy's parents showed up on parents weekend and brought him a brand new SUV as a gift, so we all realized that he was actually very wealthy, and then started noticing that his very normal looking clothes were incredibly tailored and absolutely never had any scuffs or stains.

[Jakekhalid]

Managing Money is different from accumulating wealth, and the lack of investment education in schools may explain why people struggle to maintain their financial gains. The examples you provided are relevant, and I personally benefited from the market crisis, as I embrace challenging times, while orders tend to avoid them. Well, at least my advisor does too...

[Alaerick]

I thought it was only a subset of billionaires, most notably the tech billionaires who do this. Probably because they consider themselves engineers and innovators first and foremost while they are also used to this lifestyle. Other billionaires like Russian oligarchs and Arab oil princes are indeed some of the most blinged out people on the planet.

[jsmith]

Zuckerberg having a custom plain gray t shirt is just 😂

[Meisha-san]

"Poor people, pretending to be rich people, pretending to be poor people."
That's the best description of most YT financial know-it-alls.

[dallaslooksmaxxer]

I once knew a millionaire. He once told me that money ruined his life. He told me that women only wanted him for his money and that men only wanted to be around him to do business with him. And his family expected to buy them all houses and cars. He told me that this is the reason why he drove a regular car.