The Federal Reserve's latest Survey of Consumer Finances reveals a striking divergence between income growth and wealth accumulation from 2022 to 2025.

Annualized growth in median net worth and income (inflation-adjusted):

Income percentile	Net worth	Income
Bottom 20%	−2.0%	+1.3%
20th–39th	−0.3%	+1.0%
40th–59th	+2.6%	+2.3%
60th–79th	+2.6%	+0.7%
80th–89th	0.0%	−1.0%
Top 10%	+9.4%	−2.0%
All families	+0.7%	+2.3%

The median net worth of families in the top income decile reached $3.67 million (from $2.80M in 2022), compared with $815,000 (from $818k in 2022) for the next-highest decile and $215,900 across all families.

Here's the remarkable part: Families in the top income decile saw their real median income decline approximately 2.0% annually, while their median net worth increased 9.4% annually.

Meanwhile, across all families, median income increased 2.3% annually, but median wealth grew just 0.7%.

The plutonomy angle: Income and wealth are increasingly telling different stories. Higher earnings do not necessarily translate into faster wealth accumulation, while ownership of appreciating assets can strengthen household balance sheets even when measured income declines.

The data suggest that we have become an economy where owning capital matters more than earning a high income.

McKinsey’s Workforce in Motion report argues that the U.S. labor market can create plenty of new jobs while still producing major disruption.

Exhibit 16 shows why. Millions of workers are projected to leave declining occupations such as office/admin support (4.8M), retail/sales (2.3M), and transportation/logistics (1.4M). Growth is concentrated elsewhere: healthcare, construction, management, technology and other fields.

But the pathways between them vary enormously. Many workers face “winding” or “unpaved” transitions requiring new skills, credentials, relocation, or accepting a different kind of job.

That is the Plutonomy angle: capital can reallocate quickly, but labor cannot.

AI may increase productivity and create new opportunities, while the cost of getting from the old economy to the new one falls disproportionately on workers.

According to the Financial Times, HSBC is planning to eliminate up to 70% of its financial adviser positions and approximately half of its management and specialist roles in its UK wealth management business as it expands its use of AI. The proposed reductions remain subject to consultation.

This is a big shift for a profession that has traditionally been high-income and knowledge-intensive. Now, AI is letting institutions serve the same number of clients (or more) with a fraction of the staff.

The plutonomy angle is labor-capital substitution. When a company can make the same revenue with way fewer workers, that money stops going to employee salaries and shifts directly to shareholders and tech owners.

The heatmap, from the 2025 NBER working paper, Artificial Intelligence and the Labor Market, illustrates how AI exposure is particularly pronounced in management, business and financial operations, and computer-related occupations, suggesting that AI's impact may extend well beyond routine administrative work into highly skilled, knowledge-intensive professions.

LSEG expects S&P 500 revenue to grow 11.6% in Q3.

But net income is expected to grow 30.3% and earnings 30.6%.

That gap is the story.

Companies are turning modestly stronger top-line growth into much stronger profit growth.

Revenue growth + productivity + operating leverage = expanding profits

That is exactly why the market can keep rewarding capital even when the broader economy feels much less spectacular.

According to FactSet (Oct 2, 2026), despite high rates, elevated energy costs and geopolitical uncertainty, analysts raised S&P 500 2026Q3 earnings estimates by +1.4% during the quarter.

Normally, estimates get cut as the quarter progresses. Over the past 20 years, the average revision has been -4.2%.

The Plutonomy angle: Large corporations are proving unusually resilient. Margins remain high, profits are growing, and earnings expectations are improving instead of deteriorating.

Scale, pricing power and technology are helping capital absorb shocks better than the broader economy.

The U.S. added just 29,000 jobs in September, well below expectations, and revisions erased another 60,000 jobs from July and August.

Unemployment rose unexpectedly to 4.2%, while annual wage growth slowed to 3.0%, the weakest since 2021.

Markets loved it.

The S&P 500 rose +0.7% and the Nasdaq 100 hit an all-time high as traders cut the odds of another Fed rate hike this year.

The Plutonomy angle

This is the labor economy and the asset economy moving in opposite directions.

Weak hiring and softer wages hurt workers, but they can help asset owners if they reduce expected interest rates and support valuations.

And if companies can keep growing profits while adding fewer workers, the divergence gets even wider. A weak labor market and a strong stock market are no longer contradictory.

NYC AI companies leased 2.2M+ square feet of office space in the first half of 2026, and NYC AI startups raised a record $16.7B last year.

But entry-level hiring is moving the other way.

Since 2022:

• Design/media/writing -41%
• Customer support -34%
• Administrative -31%
• Business management -27%
• Finance -23%

Meanwhile, entry-level postings requiring AI skills rose 55%.

This chart from the Partnership for New York City shows where AI is already hitting hardest: jobs with both high AI exposure and high actual adoption.

So the risk is not just “AI takes jobs.”

It is that AI removes the junior work that used to train people for senior work. The report explicitly warns that future workers may need entry-level skills without first getting the entry-level job that traditionally built them.

That is a very NYC version of the K-shaped economy:

• AI investment up.
• Office leasing up.
• Skill requirements up.
• Entry-level opportunity down.

The boom is real. So is the narrowing path into it.

FRED shows how much net worth it took to enter the top wealth tiers.

From 1989 to 2022 (last year available in FRED):

• Top 10% cutoff: $487k → $2.1M, about 4.5% CAGR
• Top 1% cutoff: $2.3M → $11.0M, about 4.9% CAGR
• Typical hourly wages grew closer to 3.3% annually

But the CAGR comparison understates the dynamic.

The top wealth tiers started with a much larger asset base. A higher return applied to millions of dollars compounds into enormous absolute gains. The top 1% threshold increased by roughly $8.7 million over the period.

And there is another asymmetry: wages are mostly consumed, while wealth is largely allowed to keep compounding.

That is the plutonomy mechanism: Large asset base × higher compounding rate × higher reinvestment rate × decades = rapidly widening balance-sheet power.

Wages can rise every year, but wealth compounds on wealth. Wage earners are trying to catch a train that already left the station and the train is moving faster than they can run.

The ladder isn't just rising faster. The people already near the top are standing on a much larger compounding base.

CNBC argues that soaring Treasury yields should eventually slow consumer spending as mortgages, auto loans, and other borrowing become more expensive.

But there is a subtle K-shaped-economy problem with that argument:

What if the consumers driving the most spending are also the consumers least sensitive to interest rates?

Higher-income households account for a disproportionate share of discretionary consumption. They also tend to have more assets, more liquidity, and less reliance on borrowing.

For a leveraged household:

Rates rise → debt service rises → spending falls.

For a wealthy household with little consumer debt:

Rates rise → borrowing costs barely matter, while interest income may actually increase.

I see this in my own behavior. Interest rates have almost no influence on whether I travel, eat out, or make a discretionary purchase because I am not borrowing to do it.

That suggests the more important transmission channel for affluent consumers may be:

Higher rates → lower asset prices → lower perceived wealth → less spending.

So CNBC is right that higher rates pressure consumption. But in a K-shaped economy, the effect may be weaker and more indirect than the textbook story suggests.

Madelaine Brockway’s Paris wedding reportedly cost about $60 million. The festivities included Versailles, the Paris Opera House, private jets, and a Maroon 5 performance.

What caught my attention was where the money came from.

Her family fortune was built through Mercedes-Benz dealerships in Coral Gables and Cutler Bay, Florida. Not tech. Not hedge funds. Car dealerships.

That is the Everywhere Millionaire story:

ordinary affluent professional → successful private-business owner → ultrawealthy dynasty

A dealership, contracting company, distributor, medical practice, or manufacturer can quietly create tens or hundreds of millions in family wealth.

The billionaire class gets the headlines. But there is a much larger ownership class underneath it with enormous purchasing power hiding in plain sight.

A new book, The Everywhere Millionaire by Owen Zidar and Eric Zwick, makes a point that fits the plutonomy framework almost perfectly.

The richest Americans are not just tech billionaires and hedge-fund managers. A huge amount of wealth sits with private-business owners: car dealership owners, HVAC contractors, beer distributors, doctors, dealers, law-firm partners, franchisees, landlords, and manufacturers.

Bloomberg notes that beyond the roughly $7 trillion held by the Americans on its Billionaires Index, another $18 trillion is held by the rest of the top 0.1%.

That group may be a big part of what I’ve been calling Groups 1–3 in the Plutonomy framework: affluent households with enough business equity, real estate, and financial assets to materially influence premium housing, travel, schools, healthcare, and other scarce markets.

The ownership class is not just concentrated in Silicon Valley or Wall Street. It is everywhere.

Edit: I listened to an interview with Zidar and Zwick, and a few numbers make the scale clearer.

The authors estimate roughly 3 million “Everywhere Millionaires”. They are private-business owners outside finance and tech with at least $5 million in net worth, averaging around $25 million. They say this group collectively holds more than 13 times the wealth of the Forbes 400.

The other takeaway is that there are many paths to wealth besides elite college → elite job.

A common path here is:

Learn an industry → find a niche → own the business → generate cash flow → reinvest → compound equity.

That helps explain who may sit inside Groups 1–3: millions of quietly wealthy owners with enough cash flow and assets to move premium-market pricing.

Goldman Sachs says labor’s share of U.S. nonfarm business output has fallen to about 53%. This is the lowest since the BLS series began in 1947.

The labor’s share has fallen roughly 7.5 percentage points since the 1990s.

Meanwhile, ownership of financial assets remains heavily concentrated toward wealthier households.

Plutonomy angle: The economy can grow while workers capture a smaller share of what it produces.

Labor share ↓ → capital share ↑ → owning productive assets becomes increasingly important relative to earning wages.

AI may accelerate this trend, but it clearly didn’t start it.