Half of all new millionaires reside in the United States
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The richest 1% own half the world’s wealth, according to Credit Suisse’s global wealth report.
Credit Suisse also found that this past year’s growth created a slew of new millionaires—2.3 million of them, with half living in the United States.
The report found that the globe saw significant (6.5%) growth in wealth during the last year, driven not only by growth in equity markets, but by growth in non-financial wealth as well.
Nevertheless, the gap between the super-rich and the rest of the world continues to grow. The very rich increased their share of the world’s wealth from 42.5% in 2008 to 50.1% in 20017.
“The share of the top 1% has been on an upward path ever since [the crisis], passing the 2000 level in 2013 and achieving new peaks every year thereafter,” the annual report said. The bank said “global wealth inequality has certainly been high and rising in the post-crisis period.”
But the world’s 3.5 billion poorest adults each have assets of less than $10,000, according to the study, as reported in the Guardian. These people, who account for 70% of the world’s working age population, account for just 2.7% of global wealth.
The report said the poor are mostly found in developing countries, with more than 90% of adults in India and Africa having less than $10,000. “In some low-income countries in Africa, the percentage of the population in this wealth group is close to 100%,” the report said. “For many residents of low-income countries, life membership of the base tier is the norm rather than the exception.” Meanwhile at the top of what Credit Suisse calls the “global wealth pyramid”, the 36 million people with at least $1m of wealth are collectively worth $128.7tn. More than two-fifths of the world’s millionaires live in the US, followed by Japan with 7% and the UK with 6%.
The report also details the recent rapid growth in the number of ultra-high net worth individuals (UHNWIs) – those with a net worth of $50m or more. Most of the new UHNWIs have been created in the US, the report says, but 22% come from emerging economies, notably China.
In general, young people should not expect to become as rich as their parents, the report predicts. “Those with low wealth tend to be disproportionately found among the younger age groups, who have had little chance to accumulate assets,” Urs Rohner, Credit Suisse’s chairman, said. “But we find that millennials face particularly challenging circumstances.”
Those circumstances, he said include high unemployment, tighter mortgage rules, increased income inequality and reduced pensions. “With baby boomers occupying most of the top jobs and much of the housing, millennials are doing less well than their parents at the same age,” Rohner said, “especially in relation to income, home ownership and other dimensions of well-being assessed in this report.”