2024-12-05 07:01:00
The last decade has been better for billionaires, those with assets above $1 billion, than for global markets. While the assets of the former grew by 121% from 2015 to 2024, the MSCI World index grew by 73%, according to data from the Billionaire Ambitions Report, published this Thursday by the UBS bank, which has been carrying out an examination for 10 years following the over 2,500 billionaires in the world. Specifically, the total assets of the ultra-rich increased from 6.3 million dollars in 2015 to 14 billion this year, a period in which this type of person increased from 1,757 to 2,682.
The growth of fortunes has not been constant over the last decade. From 2015 to 2022 it grew on average at an annual rate of 10% globally, but has since remained stable at 1%. It wasn’t the same by region either. Chinese billionaires saw their wealth double from 2015 to 2020, from 887.3 billion to 2.1 trillion. But since then, the first year since the impact of the pandemic, they have fallen to 1.8 billion, even if the number of the ultra-rich remains stable.
Americans, on the other hand, only recorded increases. From 2.5 to 3.8 billion from 2020 to 2022 and up to 6.1 billion this year, thanks mainly to billionaires in the technology and industrial sectors. And within this region, Americans increased their wealth by 27.6%, to $5.8 trillion, representing 40% of the global total. In Western Europe the line is also increasing, but in a more moderate way, going from 1.5 billion to 2.1 billion in 2020 and 2.7 billion in 2024.
In the last year,268 people have joined this exclusive club of the super-rich,60% of whom are entrepreneurs. That is to say, the majority got it through their own merits, unlike last year when most of the new ones did it by inheritance.
Over the course of this decade, entrepreneurs in the technology sector have gained more and more weight and their assets are the ones that have grown the fastest, in fact, they have tripled, going from 788.9 billion in 2018 to 2.4 trillion in 2024. all he beginning of the years they dedicated themselves to e-commerce, social networks and digital payments, but recently “they are behind the rise of generative artificial intelligence, the development of cybersecurity, financial technology, printing. 3D and robotics”, we read in the press release accompanying the report.
Another sector highlighted in the UBS publication is the industrial sector,whose billionaires have increased their fortunes from 480.4 billion to 1.3 trillion, thanks, according to the document, “to countries’ investments to increase their competitive advantage, especially in the green economy”. address demographic challenges and support the economic trend of relocation. Industrial policy interventions are benefiting technologically advanced sectors such as aerospace, defense or electric vehicles”.
Future
Looking ahead to the next 12 months, 43% of billionaires plan to increase their exposure to real estate and 42% plan to do so to developed market stocks. gold and precious metals continue to be a safe haven, with 40% considering increasing their exposure to them, which “may reflect fears of increased geopolitical risk and equity market valuations”.
There are changes when it comes to alternative assets. While 38% continue to plan to increase their direct private equity positions, 34% plan to reduce them. And free investment funds “seem to be losing interest as 27% plan to reduce their investments and 23% to increase them.” When it comes to art and antiques, 32% plan to increase their exposure, up from 11% who said so the previous year.
Taking into account the experience of the last ten years, the report assures that risk-taking billionaires will likely belong to two sectors that are taking shape: generative artificial intelligence and the electrification of renewable energy.
More female billionaires
A section of the UBS report is dedicated to female billionaires,who in the last decade have increased by 81%,from 190 to 344,mostly on their own merits. As for the sum of their fortunes,the increase was 153%,up to $1.7 trillion. On average, the wealth of a millionaire has increased by 4.8 billion, 40%, a figure lower than that of men, 5.3 billion, 45%. Regarding their investment preferences, the report indicates that they choose to do so where they can impact the lives of others and their goals are achieved. “Such as, they may want to fund the next generation’s business or pursue a passion for a certain cause.”
How do regional differences in wealth accumulation among billionaires affect global economic inequality?
Time.news Interview: The Billionaire Boom – A Decade of Wealth Growth
Editor (Time.news): Welcome, everyone, to this exclusive interview with Dr. Sarah Johnson, a renowned economist and wealth inequality expert. With us today, we’ll be diving deep into the captivating trends surrounding billionaires over the last decade, based on the recently released Billionaire Ambitions Report by UBS. Dr. Johnson, thank you for joining us.
Dr. Sarah Johnson: Thank you for having me! It’s great to be here.
Editor: Let’s get right into it. The report highlights that billionaire wealth has surged by a staggering 121% from 2015 to 2024, while global markets have only increased by 73%.What do you think are the driving factors behind this important disparity?
Dr. Johnson: That’s a crucial question. One of the key factors is the concentration of wealth in certain sectors, particularly technology and finance, where a handful of individuals have managed to capitalize on innovations and market shifts. The growth of digital platforms created immense wealth for tech entrepreneurs, and during the pandemic, these sectors thrived even more.
Editor: That’s an important point.The report also notes that billionaire fortunes have not grown uniformly, with a notable difference between American and Chinese billionaires. Chinese billionaires saw their fortunes double until 2020 but have as declined. What does this tell us about regional economic resilience?
Dr. Johnson: It reflects the broader geopolitical and economic realities. While American billionaires have benefitted continuously from their ever-expanding markets and innovation ecosystems, Chinese billionaires faced more regulatory scrutiny and economic shifts post-pandemic. It shows how policy and market access can dramatically affect wealth accumulation.
Editor: Captivating.The report mentions that the number of billionaires increased dramatically from 1,757 in 2015 to 2,682 this year. What implications does this have for global wealth inequality?
Dr. Johnson: The increase in the number of billionaires, while indicative of wealth creation, raises red flags about inequality. With more individuals at the billionaire level, we need to consider how wealth distribution impacts the economy at large. The benefits of this wealth concentration can led to societal disparities and tensions if not accompanied by inclusive economic policies.
Editor: Clearly, there are serious implications. the growth rate for billionaires has fluctuated; from 10% annually up to 2022 to just 1% in recent years. What does this stabilization mean for future economic prospects?
Dr. Johnson: A stabilization at such a low growth rate suggests that the super-rich might potentially be reaching a plateau in terms of wealth generation. It could indicate market saturation or perhaps a looming economic slowdown. Investors might become more cautious, and we could see shifts in capital allocation as billionaires reassess risk in an uncertain market.
Editor: As we look ahead, what measures do you believe could be taken to address the growing inequality brought about by these staggering wealth disparities?
Dr.Johnson: it’s vital for policymakers to focus on progressive taxation, improved access to education, and wealth redistribution strategies that empower all strata of society. Additionally, investing in social safety nets can ensure that as economies evolve, those who are most vulnerable don’t get left behind.
Editor: Excellent insights, Dr. Johnson. Before we end, can you give us a glimpse into what trends we might expect in the next decade regarding wealth accumulation and distribution?
Dr. Johnson: We will likely see continued volatility based on economic policies, technological advancements, and global events. Climate change, as a notable example, might reshape investment patterns as sustainability becomes a priority. additionally, the rise of social movements advocating for corporate accountability and fair wages may further influence billionaire wealth and its construct.
Editor: Thank you,Dr. Sarah Johnson, for sharing your expertise with us today. This conversation sheds light on the complexities of wealth accumulation in our world and the societal implications. We appreciate your time and insights!
Dr. Johnson: Thank you for having me! It’s been a pleasure discussing these vital issues.