A new report by financial giant Credit Suisse shows that the world’s super-rich have accumulated more than half the world’s wealth, while the 3.5 billion poorest in the world account for just 2.7 percent.
Since the financial crisis, the report states, the world’s top 1 percent have seen their share of global wealth rise 18 percent to 50.1 percent, or roughly $140 trillion.
“From 2013 onward, the share of the top 5 percent has been above the level observed at the start of the century, and the share of the top 1 percent is now significantly above the level we estimate for 2000,” Credit Suisse’s Global Wealth Report explains. It adds that the number of millionaires in the world is also expected to grow to an all-time high of 44 million over the next five years.
The report also draws attention to the shattering levels of inequality that exist on the global wealth pyramid. “The 3.5 billion adults with wealth below USD [US Dollars] 10,000 account for 2.7 percent of global wealth,” the report reads. “In contrast, the 36 million millionaires comprise less than 1 percent of the adult population, but own 46 percent of household wealth.”
Credit Suisse also singles out millennials has having had an “unlucky” start to their financial independence, due to the banks’ decision to be grossly irresponsible prior to the 2008 financial crisis, their decision to install tighter credit ratings, and their decision to hand out more than $1.3 trillion in student debt. The report describes the “perfect storm” holding back wealth accumulation — particularly in North America and Europe.
“Millennials have everywhere met their challenges and opportunities energetically — for example by pursuing a more active, healthy lifestyle and participating in the sharing economy,” Credit Suisse notes, seemingly cheering on millennials’ addiction to avocado toast and their decision to kill off dozens of industries. “Nevertheless, on the whole, they are not what one would call a lucky generation.”
The report comes as economists warn the world is entering a second “Gilded Age”, defined by extreme inequality and concentrated wealth in the hands of a few.
A report by the Swiss bank UBS reported that “the world’s ultrawealthy are flourishing” despite geopolitical uncertainty. “Wealth concentration is as high as in 1905, this is something billionaires are concerned about,” Josef Stadler, the study’s lead author, told The Guardian. “The question is to what extent is [this] sustainable and at what point will society strike back?”
Another recent paper by the Institute of Policy Studies found that Bill Gates, Jeff Bezos and Warren Buffet alone hold more wealth then the combined assets of the entire bottom half of the American population.
“These figures underestimate our current levels of wealth concentration,” the study read. “The growing use of offshore tax havens and legal trusts has made the concealing assets more widespread than ever before.”
As it so happens, a trove of documents obtained last week by the International Consortium of Investigative Journalists shed some light on the extent to which the world’s elite were stashing the cash away, tax free. The documents, nicknamed the Paradise Papers, originated from the Bermuda-based law firm Appleby and show that there is no ideological divide when it comes to the super-rich hiding their assets and conducting questionable business activities.
Trump’s billionaire Commerce Secretary Wilbur Ross, for instance, was revealed to have an existing stake in a shipping firm, Navigator Holdings, that makes millions of dollars a year and counts a Kremlin-linked gas company as one of its top clients. (Ross sold off the majority of his other holdings upon joining the Trump administration.) The Queen’s private estate was also revealed to have invested $13 million in offshore tax havens at the same time that British citizens were forking over half-a-billion in taxpayer dollars to refurbish Buckingham Palace. Other names that appeared in Paradise Paper documents included Madonna, Bono, Keira Knightley and former Democratic presidential hopeful Gen. Wesley Clark.