While the headlines brim with tales of the euro zone debt crisis, rising inflation and people like Nouriel Roubini warning of an approaching hard landing in China, there’s evidence that some market players, at least, are getting richer.
Credit Suisse’s Second Annual Global Wealth Report shows total global wealth increased 14 percent from January 2010 to June 2011, to $231 trillion from $203 trillion a year and a half ago.
Fund flows into emerging markets being what they are, it may come as little surprise that Asia Pacific has been the main driver of wealth creation, accounting for 54 percent of the total since the start of last year.
Osama Abbasi, CEO of Credit Suisse Asia Pacific, highlighted an ongoing shift in the world order: “…these are times of unprecedented economic change and a radical reconfiguration of the world’s economic order is taking shape. Emerging markets are important drivers of the global recovery and remain the key growth engines of global wealth.”
And according to Giles Keating, the bank’s global head of research for private banking and asset management, that’s good news for Europe.
“The much higher debt per adult level in Europe versus Asia, together with the much higher wealth growth rate in Asia versus Europe, suggest there may be scope for significant mutual collaboration to help mitigate the euro debt crisis," he said.
Europeans are sitting on an estimated average debt per adult of $25,550, compared with $9,227 for their counterparts in the Asia Pacific region. Credit Suisse calls that a sign of the continued shift of economic power from the developed world to emerging economies.
Still, the report is likely to do little to ease the concerns of protesters camped out near Wall Street and around the world.
It found that the 29.7 million adults with a household wealth of more than a million dollars make up less than one percent of the world’s adult populationbut own 38.5 percent of global household wealth.
Credit Suisse says that aging populations will put increasing pressure on public pension systems and increase the role of private funding.
At the same time, global wealth is seen rising by 50 percent to $345 trillion dollars in the next five years—equivalent to 8.4 percent growth per year from now until 2016.
Over the same period, the U.S. will remain the wealthiest country but China is forecast to overtake Japan to take the second spot with total household wealth estimated at $39 trillion.
The Credit Suisse Global Wealth Report 2011 analyzes the wealth distribution of 4.5 billion adults in more than 200 countries.