Thursday, July 1, 2010

Disparity of earning


Often we talk about the disparity between the ‘haves’ and have-nots’. World’s devastating economy continues to be morbid. It does not get shaken by the Sheiks and other world class wealthy people whose rankings are announced by a magazine called ‘Forbes’. It is ambitious for the rich and the mighty to get a ranking in it. It proclaims one’s status as a rich man in the World.

The billionaire Club has been decreasing like Law of Diminishing Returns. Yesterday’s billionaire is today’s ‘ex-billionaire’. This Club has taken the severest hit in the past 15 months more than any other year since the Magazine started grading the richest to the rich. The total number of Billionaires around the globe plunged to a new low from a record number of 1125 in the beginning of 2008 to around 793 in March 2009. This decline of 332 billionaires in a year worked to 29.5%. The Net Present Worth of world’s billionaires dropped from $ 4.4 trillion (in 2008) to $ 2.4 trillion, the percentage of rate of decline @ 45.4%. This translates to a per capita wealth per billionaire @ $ 3 billion, a steep decline of 23% or a per capita drop of $ 910 million (against 2008 figures)

At least 373 people joined the ranks of "ex-billionaires" (355 as a result of business misadventures or declining asset values and 18 who died), while only 41 climbed onto the billionaire band wagon which included 38 newcomers and three who regained spots on the 10-figure list they'd lost earlier..
Indeed, the analysis carried out by Forbes clearly indicates real estate as the villain of the piece in reducing the ranks of billionaires, with more than 250 of the "2008 billionaires " registering substantial losses due to shrinking property values, which also accounted for drop in net worth among many of those who stayed on the list. When the property market crashed Ramesh Chandra's NPW (Net Present worth) plunged from $9.6 billion to just $600 million. Real Estate also played a crucial role in the depletion of wealth of India’s biggest loser Anil Ambani who was ranked No 6 in the 2008 list with a NPW of $ 42 billion. Real estate massive losses, which accounted for 76% of his fortune, left him with $ 10.1 billion and a ranking of 34 in the 2009 list.

29 of the Indian billionaires who figured in the list during 2008 lost their ranking while the remaining 23 of the 24 still on the list had diminished NPW. Russian billionaires figured in the hit-list with 55 of the 74 knocked out of the list while the remaining 19 with decreased wealth stood in the list due to inclined and depressed markets in metals, minerals, and other natural resources including gas. Mikhail Prokhorov, the richest Russian who still figures on the current list was ranked 40 with a fortune of $ 9.5 billion. The other six Russians who were in the top fifty dropped out of the list as their wealth depleted to below $ 1 billion.

United States became the greatest causality with 110 billionaires losing their rankings.

New York City alone lost 16 billionaires while media driven fortune of Micheal Bloomberg notched up $ 16 billion (from $ 11.5 billion 2008) to get listed at number 17 from his previous 65. Twenty-eight of the Manhattan billionaires who dealt in hedging funds lost their rankings while 11 managed to hold on to the list.
Among the celebrities, television giant Oprah Winfrey with a present worth of $ 2.7 billion. Designer Ralph Lauren with 4 2.8 billion and jetsetter Richard Branson with $ 2.6 billion managed to stay on the list. Dallas Mavericks (Mark Cuban) recorded his wealth at $ 2.3 billion while jerry Jones net worth came down to $ 1.3 billion as he ended up at the 559th spot in the Forbes List of Billionaires. Wang Chuanfu of China’s was a fresh entry (seller of electric cars in China) with a recorded wealth of $ 1.4 billion. He joins the illustrious band of 23 Chinese billionaires. . Germany’s Aloys Wobben (windmill manufacturing) found his way into the list with a record net worth of $ 3.5 billion. The top ten honours went to Bill gates ($ $ 40 billion), Warren Buffet ($37 billion), Carlos Slim Helu (Mexico)($35 b), Lawrance Ellison(422.56), Ingvar Kamprad(Sweden)($ 22.6 b), Karl Albrecht(Germany)($21.5 b), Mukesh Ambani (Ind)($19.5b), Lakshmi Mittal(Ind)($19.3b), Theo Albrecht(Ger)($18.8 b), Amanico Ortega(Spain) ($18.3 billion) [Courtesy: Forbes Magazine] Even though the list made surprising ups and downs for some, elimination for some others, the addition of 38 new billionaires to the diminutive group of billionaires may send comforting signals. 2008-9 will go down in history as the Year of Economic disaster. Will hope gather momentum in 2010? We will wait and watch

No comments:

Post a Comment