Study on the super-rich: wealth of billionaires is shrinking

The weakening economy and international trade conflicts also burden the wealthiest of the rich. For the first time in five years, the total assets of billionaires worldwide are shrinking - even the German super-rich can have less assets. This is the result of calculations by the consulting firm PwC and the Swiss bank UBS.

The global total assets of the billionaires shrank accordingly in 2018 by 4.3 percent to 8.5 trillion dollars. The year before, a record $ 8.9 trillion had been reached. At $ 1.4 trillion, the growth was higher than ever before.

But now the number of the super-rich - from 2158 men and women 2017 to 2101 fell. Problems caused the billionaires according to the report, among other things, the tariff dispute between the US and China. In addition, many super-rich entrepreneurs and thus depend on orders of their companies, suffering from the economic gloom.

In the long run, however, the richest in the world can hardly complain: Over the past five years, their assets have grown by more than a third - also thanks to the stock market and real estate boom. By comparison, the sum of $ 8.5 trillion, calculated for 2018, is, after all, more than twice as high as the total economic output of Germany in a whole year. It amounted in 2018 to just under 3.4 trillion euros.

Stock market boom absorbs losses

Together with PwC, UBS has evaluated the data of 2101 billionaires in 43 countries for the report. Together, this is equivalent to a 98 percent coverage of billionaire global assets. According to their own statements, the authors themselves conducted dozens of interviews with client advisors and billionaires themselves. In addition to bank deposits, the assets also included real estate, shares and company assets.

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In Germany - after the USA and China, the country with the most billionaires in the world - according to the report, the circle of super-rich decreased to 114 - nine less than last. Their total assets shrank more than in international comparison. According to UBS chief investment strategist Maximilian Kunkel, this has the following reasons:

• The manufacturing industry in particular - such as the automotive and mechanical engineering sectors - is particularly suffering from the trade conflict between the USA and China. "And we also see that a large part of the billionaires in Germany is dependent on the manufacturing industry and accordingly was hit particularly hard here"
• In 2018, only four entrepreneurs had risen to the club of billionaires due to the " lack of innovation and risk-taking ". In the US, much more investment is being made in technological innovation. The Chinese are also more open to entrepreneurial risk
• The strong dollar also had a negative impact on the position of the Germans in the ranking. As the assets were valued in the US currency, their assets shrank by the conversion from euro to dollar .

However, billionaires in this country according to the report, still around 501 billion dollars. In order to mitigate the concomitant social inequality of wealth, the SPD had presented key points for a revival of wealth tax in the summer. On the other hand, there was some strong opposition among entrepreneurs.

Read here: Debate on wealth tax - The lament of the poor rich

Kunkel's forecast for the current year could support skeptics now argumentatively: "The core elements, which have led to a decline last year in number and assets of billionaires, have in part also this year had a negative impact." In 2019, however, the strength of stock exchanges, where stocks climbed higher and higher in recent weeks, added that "at least that should outweigh a part of this".