The rich will always be with us (2013)
Nov 13, 2013Posted by on
The rich will always be with us (2009) reported that the worlds High Net Worth Population had reduced to 8.6 Million with their share of the worlds wealth dropping to only $32.8 Trillion. The net wealth of these High Net Worth Individuals (HNWI) was only expected to reach $48.5 Trillion by 2013, a mere 44% growth over a three year period.
The following pie chart on global wealth, based on data from the Credit Suisse Global Wealth Report 2012 (pdf), indicates that 40% of the planet’s wealth is now owned by only 0.6% HNWIs, with the richest 8% HNWIs of the world’s population now owning 82% of the planet’s wealth.
NB Care needs to be taken in comparing statistics as they may not use the same criterion for a measured parameter.
Capgemini and RBC Wealth Management in their 2013 World Wealth Report (pdf), states that the HNWI population increased by 9.2% to reach 12.0 million, with aggregate investable wealth increasing by 10.0% to US$46.2 trillion (2% less than the 2009 estimation). Relatively stronger growth rates in higher wealth bands (US$5 million or more) led the growth of overall investable wealth globally. A brief view of this growth by geographical region is shown in the following slide show taken from the report.
A previous post included the following interactive graphic on global debt (including a global debt clock). Global government debt has created a taxation burden for those capable of servicing this government created debt. Debt burdens that are – for most part – greatest in Western democracies.
That HNWIs should seek to protect their wealth (as shown in the picture below) should not be a surprise. Governments always seek to buy electoral success with other peoples money, Unfortunately, most non HNWIs are rarely able to remove whatever capital they may have beyond the reach of such governments. Instead those whose wealth is held only in cash are in thrall to their government manipulating the purchasing power of their cash through its inevitable deflation.
There is of course the Tax Justice Network and similar initiatives, claiming to seek a more equitable distribution of a nation’s tax burden. Their objective being to prevent wealth that is created within a nation by HNWIs, from avoiding their ‘notional national tax obligations’. This is a complex issue on which governments take a narrow ‘nationalistic’ view, certainly not a global or regional economic view. Whatever a government’s view on equitable taxation may be, government consistently fail to finance their budget deficits with fiscal prudence. There is no indication that governments will do anything other than continue to increase its taxpayers national debt burden.