Saturday, 15 February 2020 05:12

The number of very rich people surged in 2019. Here's why

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The number of rich people around the world shot up in 2019.

That's according to a report released Wednesday from market research firm Wealth-X focusing on the "very high net worth" population, defined as those with a net worth of between $5 million and $30 million.

The number of people with a net worth of between $5 million and $30 million rose to 2.67 million in 2019, a growth rate of 10% from 2.39 million people in 2018, Wealth-X says.

By comparison, the number of people with a net worth of between $5 million and $30 million rose to 2.39 million individuals in 2018, a growth rate of just 1% from 2.35 million individuals in 2017, a Wealth-X spokesperson tells CNBC Make It.

The jump is due to the prices of most asset classes rising in 2019, according to Wealth-X.

For example, the United States stock market was up across the board in 2019: the S&P 500 was up 28.9% for 2019, its biggest one-year gain since 2013; the Nasdaq was up 35.2% in 2019, its best one-year performance in six years; and the Dow rose 22.3% in 2019, its best annual performance since 2017, CNBC reported

The surge in stock prices was largely due to global central banks focusing on "monetary stimulus" programs, wherein the leading central banks cut interest rates to stimulate the economy, according to Wealth-X. (In the United States, that is the Federal Reserve Bank.)

The United States was home to the majority of people with a net worth of between $5 million and $30 million, when compared by country. There were 969,075 very rich individuals in the United States in 2019, up 15.9% from the year earlier.

Of course, the United States also has a stark wealth gap, with income inequality in 2019 at its highest level in at least 50 years, according to one measurement from the government's Census Bureau.

China had the second highest number of very high net worth individuals, with 259,830; it was followed by Japan with 186,250 and Germany with 129,875.

Taken together, the combined net worth of these very rich individuals rose by more than 10% to $26.6 trillion in 2019, Wealth-X says.

 

CNBC