They invest in business to make more money. They provide jobs. One needs the capital to get a business off the ground. So either they themselves or the banks were they keep their money is invested back into the economy. So jobs, funding for small business, plus whatever they personally spend. Buying cars, buying houses, going on vacation, making use of local business to support their own business ventures. Google for example looks for a location to support its business needs, local business support, personnel. Pays taxes to the local government etc.
Let’s look at your final 2/3. You have to admit that 1 rich dude, no matter how flamboyant, cannot spend and therefore support local business and provide local taxes, more than 400 middle income people living in the same town. Period. Even the extravagant guy with 4 cars in his garage, isn’t coming anywhere close to the 400-600 cars those middle level families are driving around. So there’s your jobs too. All those items, all that food all that heating and electricity, all that healthcare, that the masses
Demand overwhelms BY FAR, any amount of extravagant spending by the rare super-rich dude.
As for the investment bit at the beginning of your post? You don’t think that if middle income people get some spare money, they won’t invest it? They won’t put it toward their kids’ futures?
You know what they won’t do? They won’t sock it away in Cayman Island or Swiss bank accounts, to the tune of hundreds of billions or even trillions of dollars $$$$$$$. They won’t waste it on yachts and Lamborghinis.
Oh No! Won’t anybody think of those poor Italian car assembly guys.
