The feverish optimism on Wall Street is only matched by the deep pessimism that persists on Main Street. Indeed, one of the defining features of today’s economy is the gulf in sentiment that exists between those who encounter it primarily as workers and consumers and those who experience it as investors and asset owners. For the vast majority of those who fall into the former category, the current economy is the worst it’s been in years, notwithstanding President Donald Trump’s frequent insistence that we are in the midst of an economic “golden age.”

The astronomical growth of the stock market is one of the few indicators that seems to unambiguously support the “golden age” narrative espoused by the president and his apologists, who regularly point to it as proof of a flourishing economy. According to these stock market boosters, the rising stock market directly benefits most Americans by growing their retirement savings: “Since I took office, the typical 401(k) balance is up by at least $30,000,” boasted the president in his State of the Union last March.

Trump’s market populism dovetails neatly with the GOP’s supply‑side brand, but just as Republican tax cuts have overwhelmingly benefited the wealthy, the gains from a rising stock market accrue mostly to those at the very top. For decades, the stock market has been one of the main drivers of the explosion of billionaire wealth and inequality — a trend that has now been supercharged by the AI-fueled market craze of the last several years. This reality cuts against the common claim that the stock market has been “democratized” since the 1980s, with an expanding number of Americans participating in the market due to the spread of 401(k)s, index funds, and low-commission trading.

That story contains a kernel of truth, but it obscures the fact that most public equities remain overwhelmingly concentrated in the hands of a small slice of Americans. Importantly, the greater participation in the stock market has not translated to a broader distribution of wealth. Today nearly 90 percent of the stock market is owned by just the top 10 percent of American households, while the richest 1 percent own about half of all stocks and mutual funds (roughly $25.6 trillion, half of which is owned by the top 0.1 percent). The bottom half of American households, in contrast, own just 1.1 percent of stocks. Despite claims of democratization, this concentration of ownership is up significantly from a quarter-century ago, when the richest 1 percent owned just 40 percent of the stock market.

Thus, while today over 60 percent of Americans own some shares in public companies — up from 40 percent in 1989 — the market has simultaneously grown even more concentrated. With the replacement of defined benefit retirement plans (i.e., pensions) with defined contribution plans like 401(k)s and individual retirement accounts (IRAs), more Americans directly own stocks than ever before. But this expansion has resulted more in the democratization of risk than in the distribution of wealth.

The arrival of the world’s first trillionaire last week exposed the hollowness of the “democratization” narrative. Every detail of SpaceX’s public offering illustrates how thoroughly the market has been rigged to favor the ultrarich and insiders over ordinary shareholders. From a dual‑class structure that hands Musk 85 percent of all voting power to a mandatory arbitration clause that shields the company from shareholder lawsuits, the bylaws are engineered to guarantee that Musk maintains absolute control.

Besides granting Musk ultimate power, the company’s bylaws were written to favor insiders and early investors. While lockup periods for company insiders and pre-IPO investors are typically six months, SpaceX insiders — like billionaires Peter Thiel, Antonio Gracias, and Marc Andreessen — will be free to start offloading some of their shares after the company’s first quarterly earnings report in late July or early August. According to an analysis by PitchBook, the SpaceX IPO may ultimately generate “more exit value than all VC-backed IPOs in the last decade, combined.”

This year’s blockbuster IPOs have drawn comparison to the late-cycle IPO frenzy of 1999, when internet start-ups raced to go public and insiders cashed out right at the bubble’s peak. As Katie Martin points out in the Financial Times, most of the IPOs that year had six-month lockup periods that expired “suspiciously close to the point at which markets turned.” Insiders, notes TS Lombard analyst Dario Perkins, “know when public investors are overvaluing the business and decide to get out when the times are good.”

Still, with the rising stock market being one of the few positive economic stories of the Trump era, the current administration is determined to keep the party going. At the Securities and Exchange Commission (SEC), the Trump-appointed chairman, Paul Atkins, has embraced the role of the market cheerleader, vowing to “make IPOs great again” and encourage “capital formation” by relaxing disclosure requirements and other regulatory standards. This has led to sharp criticisms from experts like former SEC Commissioner Caroline Crenshaw, who issued a dire warning last December shortly before her term expired:

We are moving away from financial intermediaries and gatekeepers and the professional standards that keep markets safe. . . .  I certainly wouldn’t be alone in analogizing the trend toward deregulation in this current environment to the period immediately prior to the stock market crash in 1929.

The administration has framed its deregulatory push much like the market populists of the Reagan years, leaning on the well‑worn rhetoric of “economic freedom” and “market democracy.” In one notable move, the president signed an executive order to further “democratize” investing by allowing 401(k)s to invest in risky and often illiquid “alternative assets” like private equity and cryptocurrencies. While framed as a move to empower ordinary investors and retirees, the rule change is more about granting the private equity industry access to some of the trillions of dollars in retirement savings, providing PE firms with a lifeline as wealthy investors increasingly withdraw their funds.

Once again, what is billed as the “democratization” of investing has far more to do with offloading risk than with sharing prosperity in any meaningful way.

The Right’s case for economic optimism largely rests on two assumptions: that the stock market’s gains reflect the health of the real economy, and that those gains are widely shared. Neither assumption holds up under the slightest scrutiny. The stock market’s irrational exuberance, set against a deep malaise in the real economy, points to an economic system increasingly geared toward enriching a narrow elite at the expense of everyone else. Far from democratizing the economy, the stock market has fueled the rise of an unaccountable and corrupt oligarchy.

The proliferation of the billionaire class over the last forty years tracks almost perfectly with the relentless rise of the stock market. In 1982, when Forbes published its first list documenting the “400 richest,” the wealthiest Americans were worth a combined $92 billion — roughly $300 billion in today’s dollars, with an average net worth of around $725 million. That same year, the SEC moved to legalize the practice of stock buybacks, which before then had been generally considered a form of market manipulation. In the years and decades that followed, public companies began issuing less dividends to shareholders — which are taxed as income — and instead used earnings to purchase their own shares, driving up stock prices.

This trend, coupled with the shareholder revolution and the tech explosion of the 1990s, helped fuel the historic growth of the stock market, enriching the biggest shareholders who conveniently no longer had to pay income taxes on their quarterly dividends. Forty years later, the practice is alive and well: in 2025, US companies purchased a record $1 trillion in their own shares, with the mega-cap tech companies like Apple, Alphabet, and Nvidia leading the way.

In Forbes’s most recent list, published last September, the 400 wealthiest Americans had a combined wealth of $6.6 trillion with an average net worth of $16.5 billion — up $1.2 trillion from the previous year. Adjusted for inflation, this represents a growth of more than 2,000 percent since the list began. In 1982, the world’s richest man was worth $2 billion; this year the world’s richest man is worth well over a trillion dollars. To put this in perspective, America’s richest man is now more than 18,000 percent richer in constant dollars than the wealthiest man was in 1982. Had the wealthiest person’s wealth simply kept pace with inflation and the GDP, he would be worth around $20 billion today.

Amid this historic inequality, any genuine effort to “democratize” the economy must start by confronting the dangerous accumulation of wealth at the top. Fortunately, the public’s growing aversion toward the billionaire class signals that Americans are increasingly ready to embrace populist proposals that would actually broaden wealth distribution and empower working people over billionaires (and trillionaires).

About a week before SpaceX made its long-awaited debut on the stock market, Sen. Bernie Sanders put forward a proposal in the New York Times that would specifically address the risk posed by mega-cap AI companies that now make up an outsize share of the American economy. The senator’s proposal would partially nationalize the big AI companies by imposing a onetime 50 percent levy to be paid for in stock, giving the public a “direct ownership stake in the largest A.I. companies in our country.” These shares would then be placed in a sovereign wealth fund, which would provide direct payments to Americans in the form of annual dividends. According to Sanders, this legislation would “guarantee that the trillions of dollars potentially generated by A.I. are used to improve the lives of all of us — not simply to make the richest people in the world even richer.”

Such a fund need not be limited to AI companies like OpenAI, Anthropic, and xAI. A broader social wealth fund — capitalized through a combination of taxes on the wealthy, corporate equity transfers, existing public assets, and other means — could provide every American with an ownership stake in the economy’s productive capital, with returns distributed as a public dividend. Matt Bruenig’s social wealth fund proposal offers the clearest blueprint for such a fund.

The approach isn’t without serious pitfalls, including the ever‑present danger of a corrupt bargain being struck between AI giants and the federal government (as would no doubt be the case in any potential deal worked out between President Trump and Sam Altman). Still, the idea of a sovereign or social wealth fund does offer a path toward a more genuine democratization of the economy, unlike the pseudo-democratization of the last four decades. At a moment when billionaire wealth is growing at historic, exponential rates while most Americans struggle with rising prices and stagnating or declining wages, every policy option should be on the table.