Global wealth surged in 2020, defying the effects of the pandemic

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Geneva, Jun 22 (EFE) .- Very contrary to what could be expected, accumulated wealth in the world increased by a considerable 7.4% in 2020 and that of adult individuals broke a new record by growing by 6% and reaching an average of $ 79,952, defying the crisis of the pandemic and its effects on the real economy, according to the annual report on global wealth of the bank Credit Suisse.

The main explanation is that, unlike what happened during the 2008 financial crisis, governments and central banks took swift and determined measures to mitigate this crisis.

“The speed and unprecedented nature of the policies that were taken reversed the decline of the markets, which looked to the future in a positive way,” said Nannette Hechler, head of investments in the area of ​​international wealth management at Credit Suisse. in the presentation of the report to the press.

Although at the beginning of the pandemic, in the first quarter of 2020, the impact on markets was severe and household wealth declined by $ 17.5 trillion (-4.4%), the recovery was quite fast and That loss had already dissipated by the middle of the year, which closed with an additional $ 28.7 trillion of wealth from the end of 2019.

The result was that year-on-year growth in wealth was 7.4% to $ 418 trillion, although the general depreciation of the US dollar contributed 3.3% to this increase.

“Wealth creation in 2020 appears to have been completely disconnected from the economic disaster caused by COVID-19,” acknowledged economist Anthony Shorrocks, lead author of the study, which is now in its 12th edition and has become reference information on the theme of wealth, its accumulation and distribution.

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Among the reasons for the increase in wealth is the continued growth of the stock markets, which reached record levels at the end of 2020, as well as the appreciation of the real estate sector, stimulated by the low interest rates and the unexpected savings that part of the population did during the lockdowns.

The regions where the increase in wealth was most notable were North America and Europe, with 12.4% and 9.2%, respectively, while the third big winner was China, which alone accounted for 4.2% of the increase in global wealth.

The biggest losers were India (-4.4%) and Latin America (-11.4%). In both places, the fall was amplified by the depreciation of exchange rates.

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