The Rich Got $17 Trillion Richer

Despite the many negative headlines, 2012 was a good year for markets. Listed below is a rough snapshot of total returns in USD – most asset classes returned double-digits. 2012 was a year to look through pessimism – how did your PA do?

I would estimate that Global Financial Wealth rose by $17,500,000,000,000 to $162 trillion (I ignore bank assets and real estate and use IMF data; BCG also hasgood studies on the topic). That seems like a lot, but it is only $23,200 per capita after the year’s $2,500 gain if it were equally divided, which it ain’t (more specifically, BCG calculates that 12.6 million “millionaire households” control 40% of the total but comprise just 1% of their sample population). Anyway here are the numbers:

Fixed Income:

Global Sovereign:            13.4%

Global Corporate*           11.2%

Global High-yield              19.6%

US Munis                              6.8%

US Treasuries**                 2.0%


EM Currencies                     7.5%

EM Loc FI (GBI-EM)         19.9%

EM Ext Debt (EMBIG)     18.5%

EM Corporates                  15.2%



Global                                   16.5%

EM                                         18.6%

S&P 500                                16.0%



CRB Index                           -3.4%

Gold                                        7.1%

*  This doesn’t mean spreads widened; sovereigns did well thanks to currency effects (different weights from Corporates) and PIIGS’ high yields. Corporate spreads rallied all year long, coming in from 260 to 148 at year end, a major rally.

** These are market weighted, so most of the index is short-maturity, very low yielding stuff. The 10-year did somewhat better, returning ~5%.

10 Responses to "The Rich Got $17 Trillion Richer"

  1. princess1960   January 11, 2013 at 2:57 pm


  2. pete   January 12, 2013 at 3:08 am

    Please explain what it means for wealth to increase by double digits when world growth is what about 4% and inflation is what 2%. Does this mean transfer of wealth or that asset values mean little or what.

  3. Galaxy S3 flip cover   February 9, 2013 at 10:01 am

    Good Job!! I like you photos in this post..nice to know you and i want to exchange link with you as a friend?do you will accept me? thanks!

    Galaxy S3 flip cover

  4. Brainsmart Focus   February 11, 2013 at 2:54 pm

    I find it astonishing that wealth has increased so significantly for the very wealthy but for the vast majority asset value and cash holdings have shrunk dramatically .What does this say about a more even distribution of global assets in the age of democaracy across the western world?

  5. T. Paine   February 13, 2013 at 4:08 am

    The age of democracy is nothing but another corporate logo. The reality is the work, sacrafices and innovations of generations disappearing, indeed evaporating into the pockets of the wealthy, connected and political classes. "Let them eat cake".

  6. Brainsmart   April 4, 2013 at 1:42 am

    There have been many times when the poorer masses have risen to overthorw a wealthier class .. but to what end , the reality is that wealth tends to gravitate to those who know how to multiply it and in the end for the benefit of all (think about job creation , enterprise and a lack of relaince on social welfare .

  7. A Woman   April 4, 2013 at 1:56 am

    Yes, there is pretty much no democracy. It is pretty much the same in all countries across the world. There is a limit, because if wealthy are too wealthy, and demos=people are too poor and unsatisfied with their life they will start to object to such a treatment. Don't you agree?

  8. ssj   May 11, 2013 at 10:45 am

    In return, the Fed would credit the Treasury’s deposit account to enable government to spend. When the Treasury spends, its account is debited, and the private bank that receives a deposit would have its reserves at the Fed credited. CCTV Camera Installers

  9. jojo   June 21, 2013 at 10:04 am

    This is interesting, I have to admit that I did not know these things before I read your article here.I found your blog in a new directory of blogs. Please click here to learn more webhosting.

  10. jojo   June 24, 2013 at 3:34 pm

    When Uncle Sam needs to spend and finds his deposit account at the Fed short, he can replenish it by issuing a nonmarketable “warrant” to be held by the Fed as an asset. With the full faith and credit of Uncle Sam standing behind it, the warrant is a risk-free asset to balance the Fed’s accounts. Fibroids Miracle