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The Super-Rich Are Getting Even Richer, Study Says

From Associated Press

The world’s seriously rich are getting richer--and seriously so, according to a report released Tuesday commissioned by investment company Merrill Lynch & Co.

Last year, the combined wealth of so-called high net worth individuals--people with investable assets of more than $1 million--amounted to more than $17.4 trillion.

That was 5% more than in 1996, despite the collapse of asset values in Asian financial markets, the report said. About one-third of it was held offshore.

And the boom will continue, said the 1998 World Wealth Report, the second annual study by Merrill Lynch and management consultancy Gemini Consulting.

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Over the next three years, the wealth of the mega-rich will grow by 10% annually, reaching $23.1 trillion at the end of 2000.

The report did not indicate whether the numbers of people who qualify as super-rich are changing or just their combined wealth.

North Americans and Europeans “still account for the lion’s share of the high net worth individual market at 59%,” the report said.

But they are slowly losing ground to the very rich from Asia and Latin America.

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“Despite suffering a decline of $300 billion in the dollar value of their wealth last year,” it said, Asians will account for 21% of the market by 2000, followed by Latin Americans, with 16%.

“In contrast, Africa will contribute only 2% to the high net worth individual market by 2000,” it said.

The report also found that traditional, lower-yield investments in bank deposits and bonds are falling from favor as their returns decline, while equities are growing in popularity.

It said the introduction of a single European currency, the euro, will be a boon for the very rich in that region, who are currently worth an estimated $5.5 trillion.

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“The euro will produce deep liquid equity and bond markets, making European capital markets attractive to issuers, which in turn will increase new supplies of higher-yield investments” for the rich, the report said.


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