This is not about increasing number of Americans fleeing the US. Instead this about Americans enduring sharp losses from stock market investments.
From CNBC.com
America’s millionaire population declined last year for the first time since the financial crisis, according to a new report.
The population of U.S. millionaire households (households with investible assets of $1 million or more) fell to 5,134,000 from 5,263,000 in 2011, according to The Boston Consulting Group’s Global Wealth study.
Total private wealth in North America fell by 0.9 percent, to $38 trillion.
The ultra-rich were the largest losers in dollar terms. Households in North America with investible assets of more than $100 million saw their wealth decline 2.4 percent. Their population declined slightly to 2,928 from 2,989.
The main reason for all this wealth loss? Stocks.
With the wealthy today increasingly dependent on stocks for wealth, last year’s stalled stock market shrunk the population of millionaires and nicked the fortunes of existing millionaires. According to BCG, the amount of wealth held in equities declined 3.6 percent last year.
Globally, the picture looked a little brighter. Virtually all of the growth in global millionaires came from emerging markets last year. While the United States lost nearly 130,000 millionaires, the rest of the world added 175,000 millionaires. There are now 12.6 million millionaire households globally, according to BCG.
That’s a study made last year.
Before yesterday’s stock market rout, US equities have been performing relatively better than the world.
Chart from Bespoke Invest
The S&P has been gradually reclaiming dominance and has outperformed the MSCI World index in late 2011 until May 30th.
This means that if emerging market millionaires are exposed to stock investments too, then the above dynamic may have partly been reversed.
And I think that with many global stock markets entering bear market territory, the number of shrinking millionaires could be a global phenomenon.
Paper money ‘wealth’ is being extinguished.
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