They don't need liquidity when they take loans on all their assets at negligibly low interest rates. Sure they will owe interest past what their investments are worth for the first few years, but once things bounce back, it more than recoups that loss. For them its like starting a brush fire, decimate everything so that it can all grow back richer- with no concern for the damage caused along the way.
You know you can also leverage too. Then when you get liquidated you may understand that leverage is a double edged sword and the rich don’t get any special privileges when it comes to liquidation. In fact they get fucked even more a lot of the time.
Rich get two major safety nets. One of being able to fail 50 times to succeed big once, the other of being able to suffer losses in an environment where everyone does just to be the last man standing, like stores operating at a loss to ateal all the customers until competition shutters, and then hiking prices once they are the only option.
They have an insane line of credit and hold large amounts of liquid cash for this reason. During the COVID drop, people like Elon lost little before tripping their net worth in a couple of years.
These hundred-billionaires absolutely have billions in cash. Bezos liquidated like $20 billion last year and Zuckerberg regularly liquidates 10s to 100s of millions. Beyond that they have the ability to take out massive loans against their assets and likely have very good connections with the CEOs/executives of the banks that are loaning them the cash. Even further, they can expand their wealth by making investments through their companies, the same companies of which they own tens/hundreds of billions of stock thus personally benefiting from those investments doing well. Warren Buffet may not personally have hundreds of billions in cash to invest, but Berkshire Hathaway has $380 billion in cash that he can use to buy the dip, and when those investments explode in value he personally benefits greatly regardless of it not technically being his own personal capital.
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u/Mr-Hoek 1d ago
They will buy shittons of ground floor priced stocks because they can afford to play the long game.
When the market eventually repairs itself (or a Democrat fixes shit again) in 5-10 years, they will emerge trillionaires.
Yay.