A million more people joined the ranks of the global super-rich last year, almost a third of them in Asia, as soaring stock markets helped bolster the fortunes of wealthy investors.
The number of “high net worth individuals” climbed by 10% in 2012, taking the total worldwide to 12m, according to research by Royal Bank of Canada and consultancy Capgemini.
Between them, these twelve million people owned assets worth $46.2tn (£29.5tn) – more than three times the entire annual output from the US economy, and a 10% increase on 2011.
A high net worth individual is defined as anyone with $1m (£641,000) or more in “investable assets”. The definition excludes the value of a main home and of any “consumer durables” such as cars.
World markets were volatile in the first half of 2012, as the eurozone crisis deepened; but after ECB president Mario Draghi promised to do “whatever it takes” to protect the single currency in July, and the Federal Reserve unleashed a drastic third round of quantitative easing in September, share prices recovered strongly, boosting the wealth of those with investments.
The findings are likely to increase concerns that the benefits of central banks’ radical policies to rekindle economic growth have accrued overwhelmingly to those at the top of society, while unemployment remains stubbornly high in many countries and incomes have been under severe pressure.
Britain is home to the fifth-largest group of super-wealthy individuals, according to the report, with 465,000 super-rich individuals, up from 441,000 in 2011.
The wealth report came as the latest UK inflation figures showed that with the consumer price index running at 2.7% in May wages for average British workers have now failed to keep up with prices for more than three years.
Frances O’Grady, general secretary of the TUC, said, “economic stagnation has caused incomes to fall for most ordinary families but the wealth of the super-rich just keeps on growing. Unless this inequality is tackled Britain could experience a pretty joyless recovery, with the majority of the population seeing little or no benefit when economic growth returns.”
The US regained its place at the top of the league table in the report, as the home to 3.73m high net worth individuals, up by more than 11.5% on 2011, as the recovering property market helped repair the damage to wealthy investors’ housing portfolios inflicted by the downturn of the past five years.
The Asia-Pacific region was just behind the US, with a population of 3.68m super-rich investors – up by more than 9% on the year.
Europe, where the economy of the single currency zone has now been in recession for 18 months, was home to 3.4m high net worth individuals, but saw a smaller rise in their number, of 7.5%, in 2012.
The researchers also sub-divide the millionaires according to their wealth. There was an increase of 11% in 2012 in the number of people classified as “ultra high net worth individuals”, the creme de la creme of the super-rich. These 110,000 people are worth $30m or more, and hold assets worth more than $16tn between them.
A middle group of just over a million people, the “mid-tier millionaires”, held $10tn-worth of assets between them; and a much larger group of 10.8m people, which the report refers to as the “millionaires next door”, held assets worth $1m-$3m.
The data also underlines the stark geographical divide in the distribution of wealth across the world, with just 140,000 of the 12m super-rich living across the entire continent of Africa. That was an increase of almost 10% from 2011; but still fewer than in Italy, Australia or Brazil.
RBC and Capgemini’s analysts forecast that the super-rich will continue getting richer, with the total wealth held by this group expected to expand by 6.5% a year over the next three years.
The super-rich emerge from the survey conducted as part of the research as a relatively conservative group. They managed their assets cautiously in 2012, while fewer than half of them said they trusted financial markets; and fewer than 40% trusted regulators.
The authors said the super-rich respondents to the survey, “exhibited a clear bias toward safety and wealth preservation, allocating nearly 30% of their financial wealth into cash and deposits.” This careful approach applied to millionaires of, “all ages and wealth levels, suggesting that the overall lower level of trust in the financial markets may be playing a role.”
This article originally appeared on guardian.co.uk
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