The mystery of billions of dollars worth of stocks being sold by some of the world’s richest despite the market continuing at record highs remains.
The mass sale has given rise to fears of an economic slowdown, or it could be fears of a looming tax increase.
The tech bubble showed it was under extreme strain throughout 2023 with mass layoffs hitting Silicon Valley, while President Joe Biden has promised a tax hike for the super-rich if he wins re-election in November.
As JPMorgan Chase CEO Jamie Dimon pointed out in a gloomy earnings statement in October: ‘This may be the most dangerous time the world has seen in decades.’
At the end of last year, it was reported that wealthy investors held less than 25 percent of their net assets in the stock market.
Investors are selling out for various reasons, US tax season is just around the corner, or some simply want to diversify with all these companies now firmly established as major players on Wall Street.
It could also simply be the oldest saying in the market, sell high.
Jeff Bezos – seen here with fiancee Lauren Sanchez – unloaded $8.5 billion in Amazon stock this month, sparking fears of financial uncertainty
Mark Zuckerberg – the world’s fourth-richest man behind Bezos, Bernard Arnaut and Elon Musk – has sold about 1.4 million Meta shares worth about $638 million since the end of 2023
Walmart’s Walton family sold $1.5 billion in one week, bringing its total sales revenue to $2.3 billion since December. Alice Walton, the 73-year-old heir to the retail dynasty, is seen here. She is worth approximately $66.5 billion and is the richest woman in the United States
Jamie Dimon, chairman and chief executive of JPMorgan, made $150 million last week — his first stock sale since taking the reins at the bank nearly two decades ago
In February 2024, Amazon founder Jeff Bezos sold $8.5 billion worth of stock over a period of nine.
Jamie Dimon sold his stock for $150 million, his first such move since taking the reins at the famous bank in 2006.
In October, Dimon laid out a laundry list of major issues: the Russia-Ukraine war, the new war between Israel and the Palestinians in Gaza, high levels of government debt and deficits, high inflation, as well as the tight labor market, where workers’ demands for increased wages have led to high-profile strikes in manufacturing and entertainment.
Facebook founder Mark Zuckerberg also got in on the act, selling $428 million worth of Meta stock in 2023.
Between February 21 and 24, the family behind Walmart, the Waltons, sold $1.5 billion worth of stock. That brought their total amount sold since December to $2.3 billion.
It is unclear where exactly these billionaires will spend their money. Zuckerberg’s sale will pay for his new residence on the Hawaiian island of Kauai, said to cost nearly $300 million.
Bezos, meanwhile, has stepped back from Amazon to devote more time to his other pursuits, including rocket company Blue Origin and his philanthropy. It is possible that he might wish to direct funds to these projects.
Experts this week theorized that the stock selloff could be the result of the looming 2024 election — and likely a showdown between Donald Trump and Joe Biden. In an interview with Fortune, one said it could lead to an economically unstable decline
The amount of shares sold by CEOs and founders between December 2023 and February 2024 reached a total of $11.5 billion, at a time when these shares were trading at an all-time high.
The $8.5 billion sold by Bezos is less than the $8.8 billion he sold in 2021. In 2021, Zuckerberg also parted with $2.8 billion between November 2020 and July 2021.
Despite this, gold was often referred to as a safe alternative to the volatile stock market trade at a near-record high of nearly $2,200.
According to a report from Assets, all of the above sales were set up months in advance under Securities and Exchange Commission rules.
Bezos announced last year that he was leaving his longtime home in Seattle to move to Miami, where he bought two properties on the ultra-exclusive Indian Creek island, dubbed the ‘billionaire bunker’.
While in the Sunshine State, Bezos will take advantage of tax laws favorable to the mega-rich.
Bezos bought two mansions for $147 million and is reportedly looking to buy three more homes on Indian Creek.
Bezos said the move was to be closer to his parents and rocket launches at his Blue Origin space company, but it also came with a big tax break.
An Investor’s Business Daily report speculated that Bezos, for example, might simply have wanted to sell because he hadn’t been active in selling his stock since 2021. The same could be said for Jamie Dimon.
Despite the seemingly large numbers, Bezos, Zuckerberg and Dimon still retain large stakes in their companies.
CNBC wealth editor Robert Frank said in an interview in October that it appears the rich are simply into ‘wealth preservation’.
