Fewer US Millionaires: Europe Overtakes North America As Richest Region In the World

A new report on global wealth says that Europe has overtaken the United States to become the richest region in the world. But the Americans still have more millionaires then the EU -- and should you want to marry one, you might be better off in Singapore or the Middle East.

Fewer millionaires as a result of recession: A woman holds up a sign that declares she is 'young, single, poor and looking for a millionaire' at a luxury goods show. Zoom
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Fewer millionaires as a result of recession: A woman holds up a sign that declares she is 'young, single, poor and looking for a millionaire' at a luxury goods show.

From dishwasher to millionaire. If that's the sort of career you want, then there's no place like the USA. It is the land of unlimited opportunity. But over the last 12 months many Americans have also come to learn about opportunities that lead in the opposite direction: from millionaire to dishwasher, for instance.

The worst global recession in decades has left its mark on the world's economic powers, but no nation has been affected quite as badly as the US, wealth dropped by 22 percent -- almost double the worldwide average. The "Global Wealth Report" released by the Boston Consulting Group (BCG) on the anniversary of the Lehman Brother's bank collapse indicates that Europe has overtaken North America to become the world's wealthiest region.

America Poorer, Europe Richer

BCG's Global Wealth report looks at the value of assets held by the asset management industry. According to these figures the world's wealth dropped almost 12 percent, going from $104.7 trillion in 2007 to $92.4 trillion in 2008. This is the first worldwide contraction in these kinds of assets in nearly 10 years, the study said. And while North America -- which includes both the US and Canada -- had $29.3 trillion, Europe had around $32.7 trillion in assets under management. So it would appear that the Europeans have been rewarded for their traditional caution in this crisis. Despite Europe's strong position, the United States still remains the world's wealthiest country, with $27.1 in assets under management.

The drop in wealth isn't entirely a result of the financial crisis -- money has been shifting around for other reasons too. As BCG says in a statement accompanying the report, "stung by losses and scandals, clients shifted their assets to basic, low-margin investments."

"A lot of investors withdrew money, some to settle debts and some to shift money into assets deemed less risky -- such as real estate or gold," Ludger Kübel-Sorger, director of BCG in Frankfurt, said.

Worldwide Fewer Millionaires

The number of millionaires around the world also decreased. In 2007 there were 11 million, but in 2008, the world could only produce 9 million, a drop of 17.8 percent. Both Europe and North America lost 22 percent of their millionaires, although the US can still claim to have the most of any country with 3.9 million millionaires. But this is only 3.5 percent of the American population. Other countries have more millionaires per capita, with 8.5 percent of Singapore's population making it as millionaires, Switzerland boasting 6.6 percent, Kuwait 5.1 percent and the United Arab Emirates 4.5 percent.

And another point for discussion arises out of this report too -- the more money you had before the financial crisis, the more risks you were taking, making any investments at all. Which is why you have come out of this crisis looking poorer. If you had no savings and no investments, you may have lost in other ways that this BCG survey does not take into account. And this is why the financial crisis appears to have hit the financial elite harder -- that is, those defined by the study as having liquid assets of $5 million dollars or more. They simply had more to lose.

Latin America was the only region where wealth increased. There assets under management grew by 3 percent in 2008. According to the BCG report, wealth levels are expected to rise again but not until 2013. Although, they say, levels may rise faster in the Asia Pacific region, in centers like Singapore and Hong Kong, where BCG expects better than average growth in the coming years.

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