In a strange coincidence, the $1.5 Trillion the Fed pumped into the market precisely matches the amount the world’s wealthiest have lost almost overnight.
The Sydney Morning Herald (“‘People right now are afraid’: World’s richest take a $1.5 trillion hit“):
The world’s 500 richest people collectively lost $US331 billion ($528 billion) on Thursday, the biggest one-day drop in the eight-year history of the Bloomberg Billionaires Index. That pushed the group’s year-to-date losses to $US950 billion ($1.5 trillion).
This week’s collapse marks the end of a decade of soaring markets and cheap money that helped the planet’s wealthiest people amass a record $US6.1 trillion less than two months ago. Those gains were obliterated over the past four days as pandemic fears and plunging oil prices sent markets into a nosedive.
Since the first of the year the world’s richest have lost 16 per cent of their collective net worth, according to the index. The market meltdown has slammed billionaires from every part of the globe and every industry.
[…]
Oklahoma fracking mogul Harold Hamm dropped off the index Monday after losing almost half his net worth, squeezed by the tumbling price of oil. Sheldon Adelson, majority owner of Las Vegas Sands., the world’s largest casino operator, has lost $US11.7 billion since the start of the year as gaming floors emptied and trade shows were cancelled. That’s more than a quarter of his net worth.
Carnival Chairman Micky Arison dropped six spots on the billionaires index Thursday after shares of the world’s biggest cruise operator plunged 31 per cent to a 23-year low. The company announced it was suspending all voyages by its Princess Cruises line for two months.Individuals higher up the ranks sustained staggering one-day losses. Luxury titan Bernard Arnault, chairman of LVMH, lost $US9.5 billion and Amazon’s Jeff Bezos’s net worth fell by $US8.1 billion. Tech titan Bill Gates saw his fortune dwindle by $US7 billion. A total of 53 billionaires saw their fortunes drop to the lowest since joining the index.
Brazil’s fortunes were particularly hard hit, both by plunging stock prices and a weakening real. Guilherme Benchimol, founder of XP, ceased to be a billionaire after shares of the Sao Paulo-based brokerage fell 34 per cent below its December initial public offering price.
Meanwhile, Russia’s wealthiest two dozen people are down $US65 billion this year, partly because of President Vladimir Putin’s oil price war with Saudi Arabia.
Obviously, no one is going to shed a tear for the mega-rich, let alone Russian plutocrats. Obviously, they can absorb losses far easier than minimum wage service workers whose jobs are disappearing as a result of the crisis.
Still, it’s a vivid metric of just how massive the economic meltdown has been. And it’s going to get a whole lot worse before it gets better.
