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 | Social : What can we learn from the World Wealth Report?
by Lucas Wyrsch on 18-Oct-09 11:25am
Likes (34) |
The 8.6 million high net worth individuals worldwide declined in number by 14.9% last year!
High net worth individuals, affluent expatriates and wealthy third patry nationals may be interested to get established a family office. According to the Merrill Lynch - Capgemini World Wealth Report 2008 there were 8.6 million high net worth individuals worldwide, a decline of 14.9% from 2007.
The total high net worth individuals wealth worldwide totaled US$32.8 trillion, a 19.5% decrease from 2007. The ultra high net worth individuals experienced greater loss, losing 24.6% in population size and 23.9% in accumulated wealth The 2009 report revised its 2007 projections that HNWI financial wealth would reach US$59.1 trillion by 2012 and revised this downward to a 2013 HNWI weaklth valued US$48.5 trillion advancing at an annual rate of 8.1%
We also know that Britain has lost last year half of Its millionaires which is a strong deviation of the average world wide decline in HNWI's! Marc Faber who predicted several crushes correctly in the past thinks that Fed will destroy the Dollar?
Larry Edelson, an experienced investor and analyst, thinks that currencies have a huge impact on the global economy and that gold is an important investment as well as an important indicator to watch.
Do we have to buy gold as a protection against systemic risks?
Do you think that we have to buy gold to be protected against future crashes and systemic risks?
Do you think that the world will be driven forward by a seismic shift in economic power
Ilian Mihov, Professor at INSEAD, thinks that people tend to assume they have more control than they do, suffering from illusion of control and significantly underestimating the level of uncertainty.
The results are overconfidence and wrong judgments and decisions. There are three basic elements of uncertainty:
areas which we know what we know, there are the areas which are known unknowns, and third, there are the unknown unknowns, the so called "black swans".
What do you think?
How do we have to shape our future?
I wish you a wonderful and successful future!
Kind regards
- Lucas
What can we learn from the World Wealth Report?
Likes (3) by Geoff Day on 18-Oct-09 12:21pm
Hi Lucas,
I think I'm at a stage in life where I want to question the value of a gold bar if it can't be eaten. Where will it all end? In tears, I suspect!
Regards
Geoff.
What can we learn from the World Wealth Report?
by Hani Zaitoun on 18-Oct-09 12:24pm
Han Zaitoun
It seems that there are many predictions being made, that is the easy part. Oil will reach $200 by 2008, gold will cross the 1,000 mark that was a year ago, a W shaped recovery and not V shaped etc....
In my simple view, the laws of this universe entail growth, since the conception of mankind and even before. Hence there is infinite growth at all times. Over a particular time growth is there, hence sooner or later we are coming to growth. With that wealth will increase, the number of millionaires will increase etc...
Keep the big picture intact, that the future will witness new inventions, ideas, efficiencies, and gorwth. Your role is to position your self to capture the next big wave, or to increase your market share, or to buy out your competitor etc...
What can we learn from the World Wealth Report?
by Dr N Bhashyam on 18-Oct-09 12:29pm
I think the world is slowly readjusting itself for transition towards a knowledge based world.Money .it seems ,may loose much of its glitter and power. We may be in for a new economic architecture and processes.It may take some time to visualize the likely changes etc.
N Bhashyam
What can we learn from the World Wealth Report?
by Beverly Young on 18-Oct-09 12:44pm
I come from a different parameter. As a 'getting on in life now' old Jewish mama, I learned at my grandpa's knee. "Buy gold liefie........we have been doing it for thousands of years. It doesn't rot, you can carry it, transfer it, hide it or wear it". Buy in June, and sell in December. (shares).
Here in South Africa we are not allowed to buy gold bars. At last. After 99 years of denial. If I had followed his advice, or had the money too then, I would be better off than Bill Gates. Still, it is the only 'fixed asset' that is constant. Slow to mature, but constant.
Next is property, it is the only way we have been able to assure our retirement. The property prices here have outstripped agriculture as an industry.
We bought a game farm 3 years ago, and are in the process of selling shares in the farm, (if any one likes the idea), but seriously, the prices are too a constant, the life extraordinary, and the returns comfortable.
No one actually knows really, fixed assets can include paintings, antiques etc, all of which increase in value and in doing so, give you pleasure at the same time. Think of history? You trek with your goods and sell if you need to, no tax, no trace.
Peace, bev
What can we learn from the World Wealth Report?
by DebraPearl Hockenberry on 18-Oct-09 12:54pm
I believe your Blog is very important. Financial illiteracy is such a large factor in this epidemic, and we really need to address this.
Respectfully,
d'Pearl
What can we learn from the World Wealth Report?
by Dr. Mehmet Yildiz on 18-Oct-09 1:05pm
Lucas, fascinating post.
So many unknown unknowns in this area.
Regards,
Mehmet
What can we learn from the World Wealth Report?
by Lucas Wyrsch on 18-Oct-09 1:05pm
Dear Geoff,
Thank you for your precious comment.
There are fears in the world that the US could enter a strong and sustainable period of inflation as its currency is only based on paper and as the paper value of hundred dollar is only about twenty US cents.
In opposite to paper money, gold is a real rare precious metal that was during decades the mean measure of foreign exchange.
During the time of the gold standard, one ounce of gold was worth US$35.
This gold standard was abolished at Bretton Wood II.
There are tendencies to reintroduce a gold standard.
I wish you a great and successful future!
All the best!
- Lucas
What can we learn from the World Wealth Report?
by Anatoli Graour on 18-Oct-09 1:09pm
Oil can be replaced by the new source of energy, property can be destroyed by the natural disaster or human, shares can loose value by the bankruptcy.
Nothing can replace or destroy the GOLD !
jewellerpro
What can we learn from the World Wealth Report?
by Lucas Wyrsch on 18-Oct-09 1:12pm
Dear Taitoun,
Thank you for your great explanations!
There certainly will be growth occasions in the future.
There also exists the demographic risk that will alter the balance in ask and bid because the babyboomer will retire.
Keep in mind that the babyboomers have had more births in the 17 years after WWII than the following 37 years.
In 2028, when the last babyboomer generation, born in 1963, will retire at 65, there will lack one third of the actually available work force in Western Europe, US and Japan.
Many industries that actually still can sell their products easily as there is great demand, will have reverse situation then.
Wealth will go to Asia, thinks Marc Faber and other experts and strongly decline in the wealthy countries that haven't a strong demographic rate.
Just my two cents of input to your brilliant posting!
Have a wonderful and successful time!
Best
- Lucas
What can we learn from the World Wealth Report?
by Edward Pietkiewicz on 18-Oct-09 1:21pm
The issue is greed in our hearts and is why Goldman and the (4) remaining banks are back to business as usual.
What can we learn from the World Wealth Report?
by Lucas Wyrsch on 18-Oct-09 1:22pm
Dear N Bhashyam,
Thank you for your precious input!
I agree with you that there is a shift from the close, selective and controlling institutional thinking of the industrial revolution era to an open, random and supportive knowledge based networking thinking of the information and communication technology era.
And yes, the external value of money will lose its power towards more intrinsic and intellectual values that cannot be easily measured.
William Edwards Deming once quoted that we only can measure about 3% and that 97% cannot be measured in quote 12:
"Three percent of the problems have figures, ninety-seven percent of the problems do not."
I wish you a great and successful time!
Kind regards
- Lucas
What can we learn from the World Wealth Report?
by Edward Pietkiewicz on 18-Oct-09 1:41pm
PS This is a moral versus financial crisis exposing all investment to insider trading, uncontrolled risk, etc.
What can we learn from the World Wealth Report?
by Lucas Wyrsch on 18-Oct-09 1:58pm
Dear Beverly,
Thank you for your great answer and for sharing your experience with us!
I agree that the old, experienced central bankers knew, before Bretton Wood II, why they trusted in gold as a standards and I really believe that we should have some gold as a hedge against systemic risks of crashes and financial turmoils.
I also think that gold as a precious metal tries to cover wealth as one of the best wealth conservation means!
We should be care of wealth destruction processes that can turn into a Black Swan because they contain unknown unknowns and we should instead invest in wealth creation and wealth conservation!
Too dangerous financial tools that have been developed these previous years very much look like HYIP we should always avoid!
But how many people are enough financial literacy to know and to understand what HYIP really means?
I wish you a lucky and successful future!
Kind regards
- Lucas
What can we learn from the World Wealth Report?
by Lucas Wyrsch on 18-Oct-09 2:08 pm
Dear Debra,
Thank you for your wonderful message!
I agree that financial literacy is covers a very large spectrum that we have to learn all to better understand the underlings!
The OECD launched 18 months ago an International Gateway for Financial Education, which serves as a clearinghouse for financial education programs, information and research worldwide.
In the UK, the alternative term "financial capability" is normally used: the Financial Services Authority or FSA in the UK started a national strategy on financial capability in 2003.
The US Government also established its Financial Literacy and Education Commission in 2003.
I wish you an outstanding and wonderful future!
All the best!
- Lucas
What can we learn from the World Wealth Report?
by Felix van Veen on 18-Oct-09 2:13pm
We are living in a virtual financial world. Only Gold is not virtual. Britain has lost half of his milionairs, where is that money they had now? It was only air money, only in the books, virtual, but not real. That's the financial world, a virtual world. Gold is real and yes you can not destroyed it. When you like to invest in Gold mining you are welkom.
What can we learn from the World Wealth Report?
by Hani Zaitoun on 18-Oct-09 2:28pm
Hani Zaitoun
It is interesting so much input coming in, and various thoughts. In my view there are two things to be learned from this crisis, first timing, and second the irrationality of the numbers. This crisis is not a prerequisite for gold as a safe haven. Where does the value of the gold come from ? Same where the value of the Dollar comes from? Hence trusting in a commodity or a paper gives it its value right. Unfortunately the paper will not last, but the gold will. If that is the problem, then let us improve on the paper and make it last. Look at the Australian paper money, I think the most enduring.
Will that answer our concerns not. If this probability does exist then yes, manage it by making diversification away from the dollar into a basket. Anyway, a weaker dollar is forseen, hence invest in EURO in pounds etc.... not only gold. In the eighties the same thing happened and then commodity prices collapsed. With commodity going up, inflation will kick in, then higher taxes will kick in and back to square one, you will find yourself poorer, and economies will be too fragile to handle it this time around.
Maintain caution, and when everybody around you is buying something and the price comes too high, STOP and go back to 101 basics, calculate, see if it is rational, do the numbers make sense. Can the majority of people afford this?
In the end all will be restored, momentum will go back into everything we do. A shift in power maybe, financial or military unknown yet. It is too early to call such shots.
What can we learn from the World Wealth Report?
by Lucas Wyrsch on 18-Oct-09 2:32pm
Dear Mehmet,
Thank you for your great message!
Benoit Mandelbrot, the originator of fractal geometry and chaos theory, thinks we're all screwed and that the global economy is in dire straits.
Black Swan author Nassim Taleb thinks that we face too much complexity and that our ROI models are means of destructions.
We live in a world that is far too complex for our traditional economic structure!
You're right that there are many unknown unknown in the financial industry!
BTW, William Edwards Deming also thought that short time ROI thinking will turn us out of business.
Deming's quotes: "Nobody gives a hoot about profit." The merit system will put us out of business. Forces of Destruction: grades in school, merit system, incentive pay, business plans, quotas.
Deming published the remarkable book Out of the Crisis that contains a lot of valuable learning of all the error we did during the last 15 years in the global financial industry!
I wish you a great and successful future!
Best
- Lucas
What can we learn from the World Wealth Report?
by Lucas Wyrsch on 18-Oct-09 2:52pm
Dear Anatoli,
Thank you for your great insights!
Hyperinflation can destroy a currency and natural disaster or wars can destroy our properties as you mention.
Gold is really a save haven in times of turmoil!
Have a great and successful time!
Best
- Lucas
What can we learn from the World Wealth Report?
by Lucas Wyrsch on 18-Oct-09 2:55pm
Dear Edward,
Thank you for your excellent analysis!
Greed is indeed one of the major problems the financial services industry is faced with and that may have triggered and accelerated the recent global financial crisis!
There still are, as Mehmet mentioned, many unknown unknowns!
Have a great and wonderful time!
Regards
- Lucas
What can we learn from the World Wealth Report?
by Lucas Wyrsch on 18-Oct-09 2:59pm
Dear Felix,
Thank you for your precious insights!
I wouldn't be limited to gold as there also exist other precious metals like silver, copper or platinum that may have a save haven effect in times of great financial turmoil.
Most of the wealth that has been destroyed in Britain has been lost in falling real estate prices. If the real estates decline, as this was the case during and after the US sub-prime crisis, the valuation of the real estate markets suffer dramatically.
You're right that gold is real and undestroyable!
Have a wonderful and successful time!
Regards
- Lucas
What can we learn from the World Wealth Report?
by keng yik chan on 18-Oct-09 3:01pm
i think the bubble not too big until consume crazily or great depress until revolution world economic think tank to figure out how to prolong the re-souses n energy
What can we learn from the World Wealth Report?
by Lucas Wyrsch on 18-Oct-09 4:42pm
Dear Zaitoun,
Thank you for your great analysis!
I agree that the question of the learning from the richest segment in the global population, the HNWIs and UHNWIs triggers a great interest, Timing is indeed of capital importance in each and every investment decision and the irrationality of the numbers that the French Doctor Gustave Le Bon has described in his book "The Crowd, a Study of the Popular Mind" lets us better understand the implication of behavioral finance and behavioral economics.
I guess that we have to improve financial literacy in order to mitigate the negative effects of the number.Before Bretton Wood II, Central Banks couldn't just print as many money as they liked, as money was be balanced through the gold standard.
The gold standard is a monetary system in which a region's common medium of exchange are paper notes that are normally freely convertible into pre-set, fixed quantities of gold. The gold standard is not currently used by any government, having been replaced completely by fiat currency. I agree with you that the best risk mitigation is a well thought diversification between stocks, bonds, cash, precious metals, real estates and participations and that we should avoid being invested in only one currency. Inflation is, like you mention, dangerous because it reduces the value of the paper money. And you're right, gold is only one of possible precious metals that can be considered as hedges.
Have a wonderful and successful time!
Best
- Lucas
What can we learn from the World Wealth Report?
by Lucas Wyrsch on 18-Oct-09 5:12pm
Dear Keng,
Thank you for your feedback!
You may be right that the bubble is not too big as all global stock exchanges already have increased the domestic market capitalization between February and September 2009 by over 50% converted in dollar denominations.
Nevertheless, last year's fall of equities was extremely dramatic and unprecedented.
I wish you a great and successful time!
Best- Lucas
What can we learn from the World Wealth Report?
by Delene Gillen on 18-Oct-09 5:27pm
Lucas:
Thanks for your gracious invitation to read and post on this subject.
Worldwide, we are undergoing a value shift which is taking us back to the basics - examining the difference between human needs and wants. Visualize, if you will - old world tugging on the shirt tail of new world demanding pay attention, get your values in check.
The population will sustain itself by exercising good judgement, evaluating how they spend and invest their money into projects that contribute to humanity, construct economic transportation, healthcare and housing infrastructure. Thus, third world conditions will be erradicated which hopefullty will negate war - a desparate measure of people reaching out to communicate that they need basic human needs, such as food, clothing, medicine and shelter covered. Once these needs are handled, thing will settle down globally.
Regards.
Delene
What can we learn from the World Wealth Report?
by vikas singh on 18-Oct-09 5:36pm
vikassingh(sd)
Nice
What can we learn from the World Wealth Report?
by Lucas WyrschBlackStar on 18-Oct-09 6:58pm
Dear Kent,
Thank you for your great analysis!
I often mentioned that we had a problem since McKinsey and Company has published their Book, the war for talent, where they mentioned that talents have to be paid exponentially and where they have taken this success model from ... ENRON.Gladwell aked in his blog "The Talent Myth" from July 22, 2002: "Are smart people overrated?"And yes, I have several times posted that I don't think the OK or Only Knowledge world would be able to win the game and I notice that they simply went KO against the LUCK people, where L stands for Location, U for Understanding, C for Connections and K for Knowledge.
I was quite surprise when I got an eMail today from John Maloney where he posted me Calvin Trillin's article Wall Street Smarts!
"If you really want to know why the financial system nearly collapsed in the fall of 2008, I can tell you in one simple sentence."
"But I have to buy you a drink to hear it?" he asked.
"Absolutely not. I can buy my own drinks. My 401(k) is intact. I got out of the market 8 or 10 years ago, when I saw what was happening."
He did indeed look capable of buying his own drinks — one of which, a dry martini, straight up, was on the bar in front of him. He was a well-preserved, gray-haired man of about retirement age, dressed in the same sort of clothes he must have worn on some Ivy League campus in the late '50s or early '60s — a tweed jacket, gray pants, a blue button-down shirt and a club tie that, seen from a distance, seemed adorned with tiny brussels sprouts."O.K.," the other guy said. "Let's hear it."
"The financial system nearly collapsed, because smart guys had started working on Wall Street."
He took a sip of his martini, and stared straight at the row of bottles behind the bar, as if the conversation was now over.I also think that the main problem was that smart guys had started working in the financial services industry!When the corporate HR started to fire all the older experienced citizen banker with banking apprenticeship and replaced them with young unexperienced mercenary college grads, because McKinsey and Company told them to do so in their War for talent, they started to copy Mao Zedong's Great Proletarian Cultural Revolution that was a simple game of control!The illusion of control has brought us KO!
We need to become more humble and to employ citizen banker in banks and not mercenary college graduates!
What we need, I think, is a peace for talent where all citizen employees are respected and where no citizen employee can be fired!We need more democracy in our corporations, like Charles Handy mentioned it in The Hungry Spirit : Beyond Capitalism - A Quest for Purpose in the Modern World to make conversation, complaint and feedback circulate with less friction!
I wish you a great and successful time!
Best
- Lucas
What can we learn from the World Wealth Report?
by Edward Pietkiewicz on 18-Oct-09 7:14pm
Curious which desperate peoples are creating war?
What can we learn from the World Wealth Report?
by Delene Gillen on 18-Oct-09 7:52pm
Gentlemen:
What you have both described are the elements of a functional organization - Kudos to you both,
Delene
What can we learn from the World Wealth Report?
by John Paul on 18-Oct-09 8:23pm
I think that we all, obviously need to acknowledge that personal wealth is relative to the general state of the economy - be it property, cash in the bank, government bonds, our personal pensions invested in the global stock market, or commodities such as platinum, gold, paladium and silver. It's that simple, it's relative.
We're all in this together - like it or not.
What can we learn from the World Wealth Report?
by Lucas Wyrsch on 18-Oct-09 9:00pm
Dear Delene,
Thank you for your brilliant analysis!
I agree that we're undergoing a worldwide value shift that will be less sofisticated than before stay on a and more basic foundation.I also think that we have to go back to value the experinced people and not fire them because of a fear of control. We need their collarboration and we need their networks!We need a peace for talent where Managers, even good ones, should be given leadership coaching, development and mentoring.
"If you train 10% of your best managers, you get more from them than 10% of your worst ones."
The industry should be talking about the "peace for talent" rather than the war!
We should be encouraged to build networks across organisations as well as within their own firms.
"We should co-operate in a peaceful way to work together to make business successful."
You're right that the population has to sustain itself by exercising good judgement, evaluating how they spend and invest their money into projects that contribute to humanity, construct economic transportation, healthcare and housing infrastructure.Infact, we had to relate much more on the bottom-up wisdom of the crowds than on the top-down expertice of the few!
Have a wondeful and amazing future!
Best regards
- Lucas
What can we learn from the World Wealth Report?
by Wouter Havinga on 18-Oct-09 9:03pm
Hi Lucas,
I wrote a comment in Jeff's post both address your question above I think.
http://twitter.com/wouterhavinga
What can we learn from the World Wealth Report?
by Lucas Wyrsch on 18-Oct-09 9:05pm
Dear Edward,
Thank you for your contribution!
I agree that people who need war are desperate and I hope that we now will have several decades with no wars!
This being said, I also hope that the war for talent will be replaced by its peaceful component, a peace fot talent and that we may change our coporations into democratic bodies where employees cannot be treated like things, but are respected citizen employees with knowledge, understanding, experience and networks!
Have a geat and successful time!
Regards
- Lucas
What can we learn from the World Wealth Report?
by John Zajaros on 18-Oct-09 9:26pm
It would be interesting to know whether, as in the case of the British millionaires, the wealth just shifted, moved (fled the UK for taxes reasons), or some other variable not considered in the article. There are always other considerations: inheritance, short term losses, paper losses, re-alignments, etc.
It just seems counterintuitive that this wealth was simply "lost." There are other factors not considered here, to be sure.
John Zajaros
What can we learn from the World Wealth Report?
by Lucas Wyrsch on 18-Oct-09 10:01pm
Dear Wouter,
Thank you for your precious contribution and the link to Jeff's blog.
Do you think that certain countries could enter again some kind of systemic risk that we call hyper inflation when you mention ever expanding loan money - bubbles?
The question now for many financial experts, countries and investors is if the world has to replace the lead currendy USD into several lead currencies like euro, yen AND gold?
Sould we create a new kind of gold standard to prevent central banks from printing money without leting this money be covered by some physical underlyings like gold, silver and platinum?
I wish you a fabulous and wonderful time!
Best
- Lucas
What can we learn from the World Wealth Report?
by Lucas Wyrsch on 18-Oct-09 10:05pm
Dear John,
Thank you for your question!
As far as I know, the reduction of British millionaires was mainly due to a reduction in real estate and a revaluation of the real estate market.If the real estate market falls substantialls, the owners of real estate have a theoretical wealth destruction.If they don't sell and the real estate market recovers to old highs, they won't have had any losses at all.If they have to sell now, they will lose half of what they thought to have owned one year ago.
Have a great and wonderful time!
Regards
- Lucas
What can we learn from the World Wealth Report?
by Zara Lockwood on 18-Oct-09 10:15pm
I liked this video, it confirms on one level why the government had to go in and help the banks rather than let them fall - they are "pillars of society" that hold up more than just money, they control the behavior of civilized society verses the chaos of a breaking down society - not from war, but from death in the value of money - Zimbabwe had a form of this, not quite like ours might be - but it's a similar pattern of order to disorder - civilized to savage - that can work at unknown / variable speeds.
Maybe this is why, in entertainment terms the zombie is a good reflection of the times - the zombie could be a virus, a hurricane, a cluster of disorder (dis - ease) that spreads through the whole body of a person, of a society, of an organization etc. If the zombie goes unnoticed (or is deliberately ignored for purposes of greed) maybe it can live quietly - then suddenly jump out!!! (the recession was a bit of a shock for some people, middle classes losing 20k off the price of their home, in Tesco they stopped selling cheap washing up liquid, I put that down to the price of oil going up) - the zombie of the banking system was living as a symbiont / parasite - people like Nassim Taleb were following it's progress.
BUT being prepared for a possible unexpected event of a big kind, does give you some warning that feels comforting - so these two top experts telling the cheery presenter - it's really bad news in equally cheery voices made me LOL a bit. smile The media can paste over the cracks now, blame it all on the current labour government, dole scroungers and immigration - rather than the FACT this is a global recession.
What can we learn from the World Wealth Report?
by Lucas Wyrsch on 18-Oct-09 10:35pm
Dear Zara,
Thank you for your great message!
I believe that it made sense that governments helped failing banks even though some experts like Jim Rogers critized it as socialism for the rich!Jim Rogers said that during the Great Depression in the 1930ies the US government didn't help failing banks and let them go bankrupt.
We had a previous example in Germany of a hyper inflation where between 1920 and end of November 1923 the value of goods and services doubled every 28 days.On November 20, 1923 one US dollar was worth over four trillions marks and this hyper inflation was probably the cause why Germany started WWII.It's certainly safe that governments have contributed to mitigate systemic risk during the world financial crisis, I agree with that.We also should strongly control and supervise the merit system!
Have a great and successful time!
Regards
- Lucas
What can we learn from the World Wealth Report?
by Alan Bowman on 19-Oct-09 9:01am
Hi Lucas
Many thanks for this highly interesting report and of course it is impossible to control the unpredictable and with globalisation the shifts of money flows make some richer some poorer.Take the Madoff Fund $65 billion went in over the years and the later investors lost out but the earlier ones got paid out and less expenses and Madoff's lifestyle and operating costs let us say that $60 billion was paid back to the earlier investors and is in circulation or stagnant somewhere.
All that money still exists in someones bank account or pocket or under the bed or maybe even some tax revenue was taken but it did not all suddenly disappear.Those that were lucky and got it back are no doubt reinvesting or waiting for bargains or perhaps they are driving up the gold price, who knows !!
I have always believed that money is like manure in your garden, if you leave it in one heap all manure does is give you etialated (yellow) grass but if you spread it around you get flowers and growth.
Thus is the same with money you spread it around and you get smiles and growth.Social Capitalism must spread this message and it must be to help all the people of the world that we do whatever it is any of us does.
Kindest regards as ever
Alan
What can we learn from the World Wealth Report?
by Zara Lockwood on 19-Oct-09 09:15pm
Dear Alan,
Thank you for your great analysis.
Besides the operational risk component of fraud from the Madoff scheme where certainly all these have profited who left the scheme before it broke, there also are all the people whose real estate evaluations have decreased dramatically after the sub-prime crisis in the US and the global repercussions through the global financial crisis.Nessim Taleb explains the unknown unknown with the black swan theory where he points out that very rate events may have dramatic impact that can change the world.
I also think that people have to diversify their investment risk in a sound way, bonds, shares, precious metals, real estates and cash to be on the safe side!
Have a wonderful and successful time!
Kind regards
- Lucas
What can we learn from the World Wealth Report?
by Lucas Wyrsch on 19-Oct-09 09:16pm
Dear Nikolay,
Thank you for your precious contribution!
Have a great and successful time!
Best
- Lucas
What can we learn from the World Wealth Report?
by Cheryl Currie on 20-Oct-09 01:09am
Cheryl Currie
http://www.cherylcurrie.com
My business is expanding YOUR business
Good report and I'd say we need to invest in ourselves, other people and the future. Whenever people invest in material objects, they lose sight that it is people that put value on these things. Living things have needs that never go away and this, beyond basic needs, extends to knowledge and services that improve the quality of life. Beyond material, the scariest investments are in ideas which can be the most intangible of all. Money is only an idea. Food, clothing, transportation and education have always been and always will be a solid investment.
What can we learn from the World Wealth Report?
by Lucas Wyrsch on 20-Oct-09 05:12am
Dear Cheryl,
Thank you for your great contribution.
You're right that we have to start to invest in ourselves, other people and the future!
Have a wonderful and successful future!
Best
- Lucas
What can we learn from the World Wealth Report?
by Venkataramanaiah Chekuru on 20-Oct-09 05:42am
TALK ON MATERIALISM SPIRITUALISM AND SHRAMA DHARMA(MSMT)
There is a clear failure of the world order today. The gunpoint Capitalism and Communism evolved out of the Industrial Revolution are a clear failure at this stage unable to solve today's problems. The conclusive orthodox religious order of various hues based on absoluteness,immutability,omnipotency and perfection are not capable of answering today's world awareness,often pulling the world backward towards intolerance and violence. The oft spoken love,brotherhood,concern for the fellow human being and co-operative social collaboration are missing today.From morning until going to bed,everybody seems to be running madly without holistic meaning to life.
It is the failure of the Teacher today than that of the student/public.The need of the hour is Innovation in every sphere more so in the social systems, social order and Spirituality. For a possible approach and answer,
please visit www.materialistspiritualist.org.
In these days of MP's Corruption, Corruption in highest places, Corruption all around us, Favouratism, Nepotism and Discrimination every where, Violence, Mistrust, Social indifference and Social disorder, we have to look for alternatives. This prompted, the Creation of this Public Charitable Trust on 11-06-2003. There is a need for Paradigm shift in our thinking, faiths, beliefs, attitudes and behavior for achieving Synergy, Peace, Harmony, Justice and Development. There is a need for striking a balance between materialism and spiritualism for ensuring human survival and life survival in general. The attitude of imposing/prescribing everything i.e. do's and don'ts for progeny must go and a system of freshness, creativity and a relook at the entire past is the need of the hour. The world today faces extreme violence, be it extremism or terrorism or fundamentalism of various origins. The root cause has to be analyzed in a dispassionate and objective manner. The technological knowledge gained by mankind should not become source of its own destruction. Wisdom should prevail over knowledge. There is a need for balance every where, be it personal life, materialist and spiritual thoughts, social order, justice, equality of opportunity or development.
There is a need to understand materialism and spiritualism and philosophy of Shrama (Labour). Materialism gives that all life originated from matter and the methods used are Scientific postulations, verification and that is the path ( i.e. induction or deduction). Whereas spiritualism originates itself from the realizations of Rishis / Mahapurushas / Prophets / Imams / Teachers / Rabbies. To understand realization is to go through that process and that is not in your hands. There is no verifiable proof as required by the scientific method. With individuals who have gained scientific knowledge and methodology and spiritual realization, fusion between them is possible which will lead to synergy between materialism and spiritualism for human wellbeing . In order to create knowledge and skills in this historically evolved situation, new ways and new postulations based on the above are required at least for the present time. These two aspects namely Materialism and Spiritualism ar e the only known aspects/methods of enquiry about Truth and there could be infinite possible methods if mankind has evolved to that state. This being a possibility.
To understand synergy, peace, harmony, justice and development in society ( global / national), one has to understand meaning of labour (Shrama), its origin, its philosophy and its ideals.
In order to bring forth a direction and knowledge and skills on these above lines i.e. Materialism Spiritualism and Shrama Dharma, this Public Charitable Trust is created on 11-06-2003, with other objectives as given in this website. Perhaps there will be more synergy, peace, harmony, justice and development with minimum Laws and least policing with the right kind of social systems. It is the failure of the teacher today, than that of the student/public. The right systems and processes have to come in place and hence creative research is required to create this. This is the major objective of this Trust.
Brief Points
1. Spiritualism - a brief
2. Materialism - a brief
3. History of Eastern and Western Philosophies --- a brief
4. Materialism Spiritualism - a new paradigm in philosophy
5. Tools used - Truth and reality and five states of existence
6. Under research and realization
7. Shrama (Labour) - origin, development and philosophy
8. Shrama Dharma - a new paradigm in social existence evolved from Eastern and Western life/ Cultural processes
9. Materialism Spiritualism and Sharma Dharma - two tools for Synergy, Peace, Harmony, Justice and Development
10. Conclusion- assimilation, Integration and Innovation and direction for future.
C.Venkataramanaiah BE(Gold Medallist),MBA(IIM-B,74-76)
Founder & Managing Trustee
Materialist Spiritualist Mission Trust
Hyderabad,INDIA
(M):+919346619385
What can we learn from the World Wealth Report?
by Alan Bowman on 20-Oct-09 8:25am
Hi Delene
You are so right about the shift in Values and it is this and personal contacts and more that will create the paradigm shift in thinking and being selfless rather than selfish.
The latter gets instant results and gratification, the former takes time and effort but pays off longterm.
Thanks for the contact.
Alan
What can we learn from the World Wealth Report?
by Wouter HavingaBlackStar on 20-Oct-09 09:04am
Hi Lucas,
With reference to your question about currencies, I think that we should aim for a global currency so that people can not speculate on these anymore.
This was covered in "The colours of money course" on this forum I wrote some of my notes of which the following probably addresses your question to me;" With reference to one single global economy we need to overcome that one culture - the Anglo Saxon- that dominates it.
In economic life the objectivity has got lost in the sense that nobody questions "market forces" as the driving factor. This supply and demand theory is one sided and does not do the world a lot of good and becomes dysfunctional. It is not working towards a healthy world society.Rudolf Steiner looking back over history felt that the current economics realm has emancipated itself from the rights sphere and cultural-spiritual sphere. In the olden day there was a different consciousness and society was ruled in a theocratic way and within that the rights sphere was incorporated and within that again was the economic life happening.
Also in feudal times there were all these different cities competing with each other but over time they conglomerated into countries and now into a global awareness. In other words we should not be thinking about competing entities. And this is exactly was I hear within Ecademy; how can we (each individual) add value.This is the basis of the presenter of the course Christopher Houghton-Budd and Associative Economics. Nowadays it is about synergetic activity, a conscious collaborative fashion. So need to partner rather than compete.
Unfortunately in economics mainstream thinking ideas like these tend to rule; Resources are scares. You allocate these by price mechanisms. In other words, survival of the fittest. And, if you come up with the idea of abundance you will be vilified.Instead one needs to start with the individual human being. That is the only concrete objective entity in economic life. Market forces are a non-entity and people cannot expect "the invisible hand" to regulate, in fact, each human being needs to regulate him/herself. And I see this happening in Ecademy where it is called R/D (Research and development).
Rudolf Steiner talked about true price as compared to the current notion of cheapest price. The true price comes from the value of what you provide for the other out of your own competencies and the description of your circumstances. He challenged the notion of paying for someone's work. As it is not work that you pay for but the value it brings to you.
Economic life nowadays conjures up a very negative human image, for example that everyone is greedy. But within the RD of Ecademy I have already noticed that values are more important and that people make a relationship with others in business and do a deal. Taking into account the other persons circumstances and competencies. Plain shopping around for the cheapest quote does not seem to the case.But in modern economics the negative tendency rears its head for example in that we love the sale but despise the expense. Instead we can say that we benefit from the competencies that the other brings to my business, a value that I can make use of.But in modern economics you are required by law to compete (EU) otherwise it can be seen as collusive behaviour.
So it is a discipline to keep the focus that each human being is doing his/her thing for the love of what s/he is doing rather than some external stimulus like a paycheck. In Ecademy the awareness has come to the fore that each one is doing his best regardless, because of people love what they do. So the economic world need to wake up - that such an integrity is a different point of view than the prevailing view."
What can we learn from the World Wealth Report?
by Lucas Wyrsch on 20-Oct-09 10:18am
Dear Venkataramanaiah,
Thank you for your wonderful and philosophical points in your posting.
Besides information and knowledge, there is deep wisdom in your message that helps understand the era of the industrial revolution with its two main trends, capitalism and communism and the conclusions that both systems are unable to solve today's problems.
I wish you a great and wonderful future!
Kind regards
- Lucas
What can we learn from the World Wealth Report?
by Lucas Wyrsch on 20-Oct-09 10:39am
Dear Werner,
Thank you for your great insights!
All stock markets have increased the domestinc maket capitalization by over 50% converted in dollar between February 2009 and September 2009 according to the world federation of exchanges.
Such a strong average recovery on a global scale has probably never occured before and it may explain why the investment appetite in venture capital is starting to increase again!
There is a new tendency to exclude the USD as a lead currency and to replace it by a basket containing the following currencies and precious metals: Euro, Yen, Renminbi and Gold.
The gold standard was a fixed system where one ounce of gold was worth US$35.- before it was abolished at Bretton Woods II.
Many economists fear the the Federal Reserve Board may print as many paper money as they like and that this will trigger inflation.
I agree with you that the gold price and the desire for a gold standard is driven very much by emotion and tradition and also by fear of an increasing inflation.
Have a wonderful and successful time!
Best
- Lucas
What can we learn from the World Wealth Report?
by Beverly Young on 20-Oct-09 10:41am
Wener, it is difficult to change the mindset of generations. Gold has proven itself to be endurable, no matter which century.
There might well be other metals, vital as they are, but you will never be able to spend them.The only metal that is overlooked is silver, of which the price is dependent on the gold price. It is seldom traded.
Think about it. In all the wealth in thousands of years, the only one remaining basic still around today, is gold/silver and land.If those wealthy people, who have lost much of their wealth this past year due to the financial woes of the world, had bought, as an example, gold bars and stored them in banks.....???? eh???
There might well be "lots of gold underground" but the cost of getting it out is becoming more and more expensive. Not only in pure financial terms, but in terms f the environmental impact etc.
What can we learn from the World Wealth Report?
by maria silva on 20-Oct-09 07:15am
Why so many suicides at Peugeot, Renault and now France Telecom and so many others we do not know? Which tactics are being used by companies to met all of its objectives? Just results, just profits! At what price? Suicidal waves suggest humankind has run out of time and dispair about future.
Global capitalism, the dominant force in modernity, increased violence, desregulation, social control,unenployment, wars, hunger, pauverty,stress (how many prozacs are sold in the world?). It trancends states. That's called "democracy"
What can we learn from the World Wealth Report?
by dr Mirjana Ilic on 20-Oct-09 07:49pm
Hi Lucas
What a nice and wisdom opinions I read here, and what to add from a litlle country with so manny problems ,jobless people,withouth nice future.We must struggle to improve possition of an individual person in future world.We need World with knowledge,understanding,withouth borders and limits-Planet Earth like in Star tracks.Monney is important but it is obvious that is comming time of alternative energies, investment in agriculture,drinking water supply and clean air. Green is colour of the future.
Best regards and hope that people with monney know what is important to invest.
Better future fot every one
Mirjana Ilic
What can we learn from the World Wealth Report?
by Lucas WyrschBlackStar on 21-Oct-09 10:18am
Dear Maria,
Thank you very much for your great input.
Do you think that the many suicides at different globally acting companies are the result of the War for Talent?As far as I know, the War for Talent was never directly fought by any democratic country, but could happen through the lack of regulations in the regulatory frameworks that seems to be corrected now!Calvin Trillin, OP-ED contributor at the New Times mentioned in Wall Street Smarts that the financial system nearly collapsed, because smart guys had started working on Wall Street.
I think that the War for Talent was an abuse of human rights, carried out by big, multinational corporations on recommendation of McKinsey's War for Talent, that was published in 1987.The financial costs of the War for Talent, as far as we know from governmental aid to the global financial industry may have exceeded tens of trillions of dollars but the collateral damages that have suffered older, experienced employees around the world will certainly never be clearly known!
I wish you an excellent and successful time!
Best
- Lucas
What can we learn from the World Wealth Report?
by Lucas WyrschBlackStar on 21-Oct-09 10:30am
Dear Mirjana,
Thank you for your great contribution.
I think that the problems of unemployment you mention are a consequence of the War for Talent.
I'm convinced that the world urgently needs a Peace for Talent.
I have the impression that the majority of the governments that start to limit excessive corporate pays and bonuses are starting to work in the direction of a Peace for Talent.Perhaps that Barack Obama has won the Nobel Peace Prize because with his regulation against corporate excesses in the pay of the top management he has already started a Peace for Talent.Seven years ago, Malcolm Gladwell wrote in the New Yorker about "THE TALENT MYTH" and asked the simple question: "Are smart people overrated?"
I think they were strongly overrated!Some days ago, Calvin Trillin, OP-ED contributor at the New Times mentioned in Wall Street Smarts that the financial system nearly collapsed, because smart guys had started working on Wall Street.If we can stop the War for Talent and switch it into a Peace for Talent, we can hope for a better future!
I wish you a great and successful time!
All the best and kind regards!
- Lucas
What can we learn from the World Wealth Report?
by Elinor Palm on 23-Oct-09 10:13am
I agree and think positive thoughts have impact. There´s been examples of how a collective mind made things happen. In that point of view, I think the news make people think in negative ways and the more negative thoughts the more likely the negative is going to happen. I think it´s of great importance to try to find more balance in how news are presented and which the other
perspectives are. I think the more dark and negative the news are the more money is in it.
Elinor Palm
What can we learn from the World Wealth Report?
by Güzin Hatice TAHMAZ on 24-Oct-09 09:27am
Of course economic crisis affected Turkey's millionaires like other countries'. But losses of them r small.
What can we learn from the World Wealth Report?
by Karl Waelti on 24-Oct-09 01:09pm
Hello Lucas,
The article below sounds as it is a choke, but there is a lot of truth in it? How to change the world?
INTERESTING ARTICLE on Current Account Balance (please read the article below)
Rank Country Current account balance (million US $)
1 People's Republic of China (PRC) 179,100
2 Japan 174,400
3 Germany 134,800
4 Russia 105,300
5 Saudi Arabia 103,800
6 Norway 63,330
7 Switzerland 50,440
8 Netherlands 50,170
9 Kuwait 40,750
10 Singapore 35,580
11 Venezuela 31,820
12 Sweden 28,610
13 United Arab Emirates 26,890
14 Algeria 25,800
15 Hong Kong 20,900
16 Canada 20,560
17 Malaysia 17,860
18 Libya 14,500
19 Brazil 13,500
20 Iran 13,130
21 Nigeria 12,590
22 Qatar 12,510
23 Taiwan 9,700
24 Finland 8,749
25 Iraq 8,134
26 Angola 7,700
27 Oman 7,097
28 Belgium 6,925
29 Austria 5,913
30 Argentina 5,810
31 Chile 5,063
32 Denmark 4,941
33 Philip pines 4,900
34 Luxembourg 4,630
35 Trinidad and Tobago 3,259
36 Azerbaijan 2,737
37 Egypt 2,697
38 Korea , South 2,000
39 Bahrain 1,999
40 Gabon 1,807
41 Botswana 1,698
42 Yemen 1,690
43 Indonesia 1,636
44 Peru 1,515
45 Israel 1,643
46 Uzbekistan 1,410
47 Burma 1,247
48 Republic of the Congo 1,215
49 Vietnam 1,029
50 Ecuador 727
51 Bolivia 688
52 Papua New Guinea 661
53 Namibia 572
54 Ivory Coast 460
55 Cameroon 419
56 Morocco 389
57 Bangladesh 339
58 Turkmenistan 321.2
59 Equatorial Guinea 175
60 British Virgin Islands 134.3 (1999)
61 Kazakhstan 113
62 Cook Islands 26.67 (2005)
63 Pal au 15.09 (2004)
64 Tuvalu 2.323 (1998)
65 Samoa -2.428 (2004)
66 Tonga -4.321 (2005)
67 Comoros -17 (2005)
68 Kiribati -19.87 (2004)
69 Swaziland -23.13
70 São Tomé and Pr íncipe -24.4
71 Vanuatu -28.35 (2003)
72 Federated States of Micronesia-34. .3 (2005)
73 Anguilla -42.87 (2003)
74 Cape Verde -44.43
75 The Gambia - 54.61
76 Burundi -57.84
77 Haiti -58.72
78 Tajikistan -73.95
79 Lesotho -75.44
80 Seychelles -78.59
81 Antigua and Barbuda -83.4 (2004)
82 Guyana - 84.3
83 Rwanda -104.1
84 Honduras -160
85 Zambia -165.4
86 Republic of Macedonia -167
87 Belize -173.4
88 Malawi -186
89 Ghana -219
90 Armenia -247.3
91 Togo -261.9
92 Zimbabwe - 264.6
93 Kyrgyzstan -287.3
94 Paraguay -300
95 Chad -324.1
96 Benin -342.7
97 Guinea -344
98 Cambodia -369
99 Mexico -400.1
100 Uganda -423
101 Eritrea -440.5
102 Mozambique -444..4
103 Fiji -465.8
104 Panama -467
105 Madagascar -504
106 Laos -404.2
107 Belarus -511.8
108 Syria -529
109 Moldova -561
110 Uruguay -600
111 Burkina Faso -604.6
112 Mauritius -651
113 Albania -679.9
114 Georgia -735
115 Tunisia -760
116 Slovenia -789.2
117 Nicaragua -883
118 Senegal -895.2
119 Thailand - 899.4
120 Tanzania -906
121 Malta -966.2
122 Jamaica -970
123 Cyprus -1,051
124 El Salvador -1,059
125 Sri Lanka -1,118
126 Ken ya -1,119
127 Dominican Republic -1,124
128 Costa Rica -1,176
129 Cuba -1,218
130 Guatemala -1,533
131 Bosnia and Herzegovina -1,730
132 Estonia -1,919
133 Ukraine -1,933
134 Colombia -2,219
135 Serbia -2,451 (2005)
136 Latvia -2,538
137 Lithuania -2,572
138 Jordan -2,834
139 Croatia -2,892
140 Iceland -2,932
141 Ethiopia -3,384
142 Slovakia -3,781
143 Czech Republic -4,352
144 Sudan -4,510
145 Poland -4,548
146 Bulgaria -5,100
147 Lebanon -5,339
148 Pakistan -5,486
149 New Zealand -7,944
150 Hungary -8,392
151 Ireland -9,450
152 Romania -12,450
153 South Africa -12,690
154 Portugal -16,750
155 Greece -21,370
156 Italy -23,730
157 Turkey -25,990
158 India -26,400
159 France -38,000
160 Australia -41,620
161 United Kingdom -57,680
162 Spain -98,600
163 United States -862,300
Saving is sin, and spending is virtue...
Interesting article written by an Indian Economist
Japanese save a lot. They do not spend much. Also Japan exports far more than it imports. Has an annual trade surplus of over 100 billions. Yet Japanese economy is considered weak, even collapsing.
Americans spend, save little. Also US imports more than it exports. Has an annual trade deficit of over $400 billion. Yet, the American economy is considered strong and trusted to get stronger.
But where from do Americans get money to spend?
They borrow from Japan , China and even India .
Virtually others save for the US to spend. Global savings are mostly invested in US, in dollars.
India itself keeps its foreign currency assets of over $50 billions in US securities. China has sunk over $160 billion in US securities. Japan 's stakes in US securities is in trillions.
Result:
The US has taken over $5 trillion from the world. So, as the world saves for the US, Americans spend freely. Today, to keep the US consumption going, that is for the US economy to work, other countries have to remit $180 billion every quarter, which is $2 billion a day, to the US !
A Chinese economist asked a neat question. Who has invested more, US in China , or China in US? The US has invested in China less than half of what China has invested in US.
The same is the case with India . We have invested in US over $50 billion.
But the US has invested less than $20 billion in India .
Why the world is after US?
The secret lies in the American spending, that they hardly save. In fact they use their credit cards to spend their future income. That the US spends is what makes it attractive to export to the US . So US imports more than what it exports year after year.
The result:
The world is dependent on US consumption for its growth. By its deepening culture of consumption, the US has habituated the world to feed on US consumption. But as the US needs money to finance its consumption, the world provides the money.
It's like a shopkeeper providing the money to a customer so that the customer keeps buying from the shop. If the customer will not buy, the shop won't have business, unless the shopkeeper funds him. The US is like the lucky customer. And the world is like the helpless shopkeeper financier.
Who is America 's biggest shopkeeper financier? Japan of course. Yet it's Japan which is regarded as weak. Modern economists complain that Japanese do not spend, so they do not grow. To force the Japanese to spend, the Japanese government exerted itself, reduced the savings rates, even charged the
savers.
Even then the Japanese did not spend (habits don't change, even with taxes, do they?).. Their traditional postal savings alone is over $1.2 trillions, about three times the Indian GDP. Thus, savings, far from being the strength of Japan , has become its pain.
Hence, what is the lesson?
That is, a nation cannot grow unless the people spend, not save. Not just spend, but borrow and spend.
Dr. Jagdish Bhagwati, the famous Indian-born economist in the US , told Manmohan Singh that Indians wastefully save.. Ask them to spend, on imported cars and, seriously, even on cosmetics! This will put India on a growth curve. This is one of the reason for MNC's coming down to India , seeing the
consumer spending.
'Saving is sin, and spending is virtue.'
But before you follow this neo economics, get some fools to save so that you can borrow from them and spend!!!
God Bless You
ASIASTAR INVESTMENT HOLDINGS INC., (BVI)
GRAND PACIFIC ALLIANCE LTD., (BVI)
(PROFESSIONAL FINANCIAL SERVICE PROVIDER & FACILITATOR)
What can we learn from the World Wealth Report?
by Lillian M. Ibrahim on 25-Oct-09 11:59am
I agree with you Dr. Mehmet
All of them are unknown to us aren't they!
Is the puropose to make money only, I guess.
However I'm happy to meet the persons I know them beofre as we Dr. mehmet.
Lillian Moussa
Lillian.moussa@orascomhd.com
Cell: +2012-2959061
What can we learn from the World Wealth Report?
by Lucas Wyrsch on 14-Nov-09 1:55pm
Dear Srinivas,
Thank you for your great contribution.
Is the fact that many of us are greedy linked to social pressure?
Does it begin at school with the competition system we have put in place?
And does it amplify with the war for talent that big corporates have put in place?
I wish you a wonderful and successful time!
Kind regards
- Lucas
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