More are in the money

DUBAI, United Arab Emirates – The ranks of the world’s millionaires swelled by more than half a million people last year to 8.7 million, according to a study released Tuesday.

Experts at the financial services firm Merrill Lynch &Co. Inc. and consultancy Capgemini, which conducted the research, credited strong global economic growth as well as solid market performance but said they expected some slowing of those forces in coming years – and thus a reduction in the growth of millionaire echelons.

The study, the 10th annual World Wealth Report, said the number of millionaires grew more than 6 percent last year and has nearly doubled since 4.5 million millionaires were counted in 1996.

The wealth of the millionaires – who are defined as people with financial assets of at least $1 million, excluding their primary residences – totaled $33.3 trillion in 2005, up 8.5 percent from $30.7 trillion in 2004, the report said.

It said that there were 85,400 people with financial assets of more than $30 million in 2005, a 10.2 percent increase from 2004. These so-called ultra high net worth individuals numbered 77,500 in 2004.

“Economic growth and market capitalization were the two main drivers of wealth creation,” Robert McCann, executive vice president of Merrill Lynch, told a news conference in New York.

This, he said, has led to the assets of wealthy families growing about 8 percent a year in the past decade. McCann said, however, that this was expected to slow to about 6 percent in the next few years as central banks raise interest rates, higher oil prices affect consuming nations and a slowing Chinese economy has a “ripple effect” on other Asian nations.

The higher wealth accumulation in 2005 also reflected more aggressive investing, the report said.

It said that millionaires increased their holdings of stock to 31 percent of their portfolios in 2005, up from 30 percent the year before, and of alternative investments such as hedge funds and commodities to 22 percent in 2005, up from 20 percent in 2004. They slightly reduced holdings of real estate and cash, while fixed income investments were unchanged at 21 percent.

The report found some shift away from investing in North America and Europe and toward the Asia-Pacific region.

North America remained the wealthiest region, with 2.9 million millionaires and $10.2 trillion in wealth. But it was the first year in three that the growth in North America’s high net worth population – 6.9 percent in 2005 – failed to exceed the previous year’s growth – 9.9 percent in 2004.

The number of millionaires grew 4.5 percent in Europe to 2.8 million; 7.3 percent in Asia-Pacific to 2.4 million; 9.7 percent in Latin America to 300,000; and nearly 12 percent in Africa to 100,000.

The red-hot Middle East saw nearly 10 percent growth in millionaires with record oil revenues and soaring stock markets pushing 300,000 people over the million-dollar mark.

“This is becoming a very attractive place to invest,” said Mones Bazzy, Merrill Lynch’s head of Middle East private banking in Dubai.

Talk to us

More in Herald Business Journal

FILE - In this Monday, March 23, 2020, file photo, a worker walks near a mural of a Boeing 777 airplane at the company's manufacturing facility in Everett, Wash., north of Seattle. Beginning in 2024, some 737 planes will be built in Everett, the company announced to workers on Monday. (AP Photo/Ted S. Warren, File)
With 747 out, Boeing to open new 737 Max line at Everett’s Paine Field

Since the last 747 rolled out of the factory, speculation has been rife that Boeing might move some 737 Max production to Everett.

IonQ will open a new quantum computing manufacturing and research center at 3755 Monte Villa Parkway in Bothell. (Photo courtesy of IonQ)
Quantum computing firm IonQ to open Bothell R&D center

IonQ says quantum computing systems are key to addressing climate change, energy and transportation.

Nathanael Engen, founder of Black Forest Mushrooms, sits in the lobby of Think Tank Cowork with his 9-year-old dog, Bruce Wayne, on Friday, Jan. 27, 2023, in downtown Everett, Washington. (Ryan Berry / The Herald)
Growing green mushrooms in downtown Everett

The founder of Black Forest Mushrooms plans to grow gourmet mushrooms locally, reducing their carbon footprint.

Barb Lamoureux, 78, poses for a photo at her office at 1904 Wetmore Ave in Everett, Washington on Monday, Jan. 23, 2023. Lamoureux, who founded Lamoureux Real Estate in 2004, is retiring after 33 years. (Annie Barker / The Herald)
Barb Lamoureux, ‘North Everett’s Real Estate Agent’ retires

A longtime supporter of Housing Hope, Lamoureux helped launch the Windermere Foundation Golf Tournament.

Bothell
AGC Biologics in Bothell to produce new diabetes treatment

The contract drug manufacturer paired with drug developer Provention Bio to bring the new therapy to market.

FILE - The logo for Boeing appears on a screen above a trading post on the floor of the New York Stock Exchange, Tuesday, July 13, 2021. Boeing is reporting a money-losing quarter as both its civilian-airplane division and the defense business are struggling. Boeing said Wednesday, April 27, 2022,  that it lost $1.24 billion in the first quarter and took large write-downs for several programs.  (AP Photo/Richard Drew, file)
Boeing plans to cut about 2,000 finance and HR jobs in 2023

Boeing plans to outsource about a third of the eliminated positions to Tata Consulting Services in Bengaluru, India.

FILE - In this file photo dated Monday, March 11, 2019, rescuers work at the scene of an Ethiopian Airlines plane crash south of Addis Ababa, Ethiopia.  The number of deaths in major air crashes around the globe fell by more than half in 2019 according to a report released Wednesday Jan. 1, 2020, by the aviation consultancy To70, revealing the worst crash for the year was an Ethiopian Airlines Boeing 737 MAX on March 10 that lost 157 lives. (AP Photo/Mulugeta Ayene, FILE)
US board says Boeing Max likely hit a bird before 2019 crash

U.S. accident investigators disagree with Ethiopian authorities over the cause of a 2019 Boeing 737 Max crash.

Store owner Jay Behar, 50, left, and store manager Dan Boston, 60, right, work to help unload a truck of recliners at Behar's Furniture on Monday, Jan. 16, 2023. Behar's Furniture on Broadway in Everett is closing up shop after 60 years in business. The family-owned furniture store opened in 1963, when mid-century model styles were all the rage. Second-generation owner, Jay Behar says it's time to move on. (Annie Barker / The Herald)
Behar’s Furniture in Everett closing after 60 years

“It’s time to move on.” The small family-owned store opened in 1963 and grew to cover an entire city block.

Katy Woods, a Licensed Coach, Branch Manager, and experienced Banker at Coastal Community Bank.
Coastal Community Bank Offers Classes for Businesses

To support local business owners and their teams, Coastal offers complimentary Money… Continue reading

Innovative Salon Products online fulfillment employees, from left, Stephanie Wallem, Bethany Fulcher, Isela Ramirez and Gretchen House, work to get orders put together on Friday, Jan. 6, 2023, at the company’s facility in Monroe, Washington. The company began including pay, benefits and perks to its job listings over a year ago, well ahead of the new statewide mandate to include a pay range on job postings at companies with over 15 employees. (Ryan Berry / The Herald)
New state law requires employers to give pay range in job postings

Washington’s new pay transparency law aims to narrow wage gaps based on race or gender — though some companies may seek loopholes.

Paddywack co-owner Shane Somerville with the 24-hour pet food pantry built by a local Girl Scout troop outside of her store on Tuesday, Dec. 20, 2022 in Mill Creek, Washington. (Olivia Vanni / The Herald)
An out-paw-ring of support: Mill Creek pantry feeds pets, day or night

With help from local Girl Scouts, the Mill Creek pet food store Paddywack is meeting the need for pet supplies in a pinch.

Kelly Cameron is the woodworker behind Clinton-based business Turnco Wood Goods. (David Welton)
Whidbey woodworkers turn local lumber into art

In the “Slab Room” at Madrona Supply Co., customers can find hunks of wood native to the south end of Whidbey Island.