A holiday season of 2 tales
The haves vs. the have nots
This year has gone by with a blink of an eye.
I cannot believe I am already counting down the days until the holidays.
Yet as we head into the most “festive” time of the year, the mood feels split.
On one side, luxury stores are doing well, patrons are visiting fine dining restaurants, and some people are treating December like a reward for a great year.
On the other side, families are cutting back, stretching paycheques, and hoping the credit card bill in January is not maxed out.
Same calendar.
Same country.
Two very different realities.
That is the K shaped economy.
What is a K shaped economy?
Economist Peter Atwater suggested a K shaped economic recovery after the pandemic.
A K shaped economy is exactly what it sounds like.
After a major economic shock, instead of everyone recovering together, the wealthy trend upward while others trend downward.
One part of society sees their wealth compounding - the upper leg of the K.
The other part sees their stability slipping away - the lower leg of the K.
It’s happening right in front of our eyes.
Recent reporting points this out clearly:
The wealthiest 10 percent of Americans own close to 87 percent of the stock market. The bottom half owns just a tiny slice - The Independent
RBC Economics finds that the top 10 to 20 percent of households, flush with income from liquid assets, are driving most of the spending, while the bottom 80 percent have very little financial cushion - RBC
The government data seemed to suggest the economy looks “okay” on the surface, but the reality is very different for the haves vs. have nots.
Economic growth is hanging in there, unemployment is still relatively low, and markets are near record highs.
Yet many households feel squeezed, anxious and behind.
That gap is the K.
The disappearing middle class
I feel for the middle class.
Growing up, I was not raised with money.
We grew up in Taiwan with my parents who earned comfortable dual incomes, but we were not rich.
When I first came to Canada, I brought enough savings to pay for one year of university and that was it.
I know what it feels like to stretch every dollar, to pray you don’t get hit with an unexpected bill, to wonder if you’ll ever be able to build any real wealth.
But I was also fortunate.
My parents taught me how to work hard and save money.
Later, I became a student of the markets and the economy.
By consistently trying to beat the market by even a small amount, year after year, the results compounded.
A little bit better, for a long time, adds up.
Asset owners have done well
Now let us talk about the upper leg of the K.
If you owned assets over the past few years, you probably felt it:
The S&P 500 is up roughly 16 percent year to date
Home values in many areas in US and Canada climbed between 45 to 55 percent from 2020 to 2025, according to US national housing data. That is more than a decade worth of typical appreciation squeezed into five years
Gold has more than doubled over the past three years
This is the quiet engine behind the K shaped story:
Asset inflation.
Asset owners will likely continue to do well
The forces that created the K shaped economy are still in place:
Central banks and governments that step in aggressively during crises
Structural housing shortages in many markets, especially in Canada
Technology and AI boosting profits and stock valuations faster than wages for average workers
As long as inflation remains and money keeps flowing into financial markets, asset owners are positioned to benefit:
Asset price appreciation
Rental income or dividend income
The gradual erosion of debt in nominal terms over time
And this isn’t slowing down.
In a K shaped economy, those who hold assets continue accelerated upward momentum while those without fall further behind.
If you’re in the middle class, I urge you:
Delay instant gratification
Save some money for investments
Avoid short term “get rich quick” investments
Investing in financial assets for the long term
The disappearance of the middle class won’t happen overnight.
This trend will unfold over decades.
Which also means there’s still time.
Still opportunity.
Still room to get ahead.
Educate your children so they can get ahead
Everything I know about money, investing, and markets, I had to learn them myself.
Education paid the highest dividends.
By far.
It’s the best ROI I’ve ever experienced.
Not a degree.
Not a certificate.
But financial literacy.
Understanding how the world works.
Understanding how money moves.
Understanding how assets appreciate.
If you want your children to thrive in the future, teach them financial literacy early.
Teach them that saving alone doesn’t work in high inflation environments.
Teach them how to own assets instead of liabilities.
12 Days of Christmas and Holidays
Speaking of financial education, I’m hosting a 12 Days of Christmas and Holidays - Gift of Knowledge to Real Estate Investors speaker series.
This is my 4th year hosting the event.
It’s a great opportunity for anyone who is interested to learn and get educated from experienced real estate investors sharing their experiences.
Many of them, just like me, came from the middle class.
We got ahead through real estate and this event gives us the opportunity to pay it forward.
If you’re interested, here’s the link to sign up for the event for free:
If you like my work, I invite you to share it with others.
Eric Chang
Calgary, Alberta, Canada
December 2, 2025
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