I had breakfast yesterday in a Manhattan diner with a gentleman worth several million dollars. It turned out we had identical reading glasses. There was no discernible difference in quality. I paid $134 for mine in Cohen's Fashion Optical. He told me he had got his for eight dollars in a local store.

There were two lessons in this for me. One, that I had paid an exorbitant amount for a product which had cost only a fraction of the price to produce. Two, people who might be classified as wealthy do not live as extravagantly as we ordinary mortals might imagine.

Many Americans believe a "rich" person is someone whose possessions range from a corporate jet and a private movie theatre to a vacation home and a yacht, according to a nationwide survey by the NPD Group published last week in the Wall Street Journal.

But this is not so. Indeed many very rich Americans wear inexpensive suits and $100 watches and don't own private film theatres, say Thomas Stanley and William Danko in their best-selling book, The Millionaire Next Door. Less than one in four own new cars. Jeff Skoll, vice president of eBay and one of Canada's five richest people, only last year replaced his '89 Mazda RX-7 with a new car, and then because the Mazda broke down. The concept of wealth in the United States has changed so much in the last few years of booming growth that Americans generally believe you now have to have an average net worth of $2.86 million gross to be considered "rich". The rule of thumb to calculate net worth is to multiply one's age by pre-tax annual household income from all sources and divide by ten.

A million bucks is no longer seen by people as such a big deal. American College graduates today anticipate they will be worth a million by the time they are 40. The economy might be slowing but most "didn't feel it influenced their perception of what it takes to be rich", said Judith Hepplewhite, a senior analyst of NPD.

Most people believe that to really qualify for the title "rich", an American should not just have a million or so but should actually be making more than $1 million every year. Thousands of households in the United States do bring in that much annually, among them the seriously-rich whose wealth is measured in billions rather than millions.

So what is happening now that the Nasdaq bubble has burst? Firstly, people of median income who typically live in suburban avenues and have maxed-out credit cards, and who accumulated paper wealth last year as their technology stocks soared, have taken a beating. "I was a millionaire last year and now I'm broke because of the damned Nasdaq," a Democratic Party fundraiser told me.

Secondly billionaires have "lost" fantastic sums since the Nasdaq started its slide a year ago, though they still command financial assets worth more than the GNP of small countries. As of January 30th, Bill Gates of Microsoft dropped from $74.2 billion in holdings to a mere $44.6 billion, and his rival Larry Ellison of Oracle plunged from $56.3 billion to $25.7 billion.

Jerry Yang, founder of Yahoo, who always claimed not to care about the money anyway, saw his shares lose 85 per cent of their value and his worth drop from $8.08 billion to a miserable $947 million, putting him out of the New Technology Billionaire's Club.

This trend is bad news for that sector of the American economy which supplies corporate jets and home movie theatres to those who do spend extravagantly. It is also a set-back for foundations relying on philantrophy, which is big business in the US.

A very few multi-millionaires have given away almost all their wealth, but even a minuscule proportion is a lot of money, like the $1.5 billion donated by the Bill and Melinda Gates Foundation in 2000 mainly to combat disease in the Third World. Such donations are now threatened. The real pain for the recently-rich will come in two weeks when Americans calculate their tax for the previous year. President George W Bush famously told Americans during his election campaign, when promising lower taxes, "It's your money, you paid for it". Now many will have to pay for money they no longer have.