Posts Tagged ‘High net worth individuals’

The rising tide lifts the high net worth folks

June 29, 2011

“High net worth individuals” – people with $1 million or more in ready cash to spend – are leaving behind the vast majority of people worldwide, who are treading water or sinking economically, according to a report by Capgemini, a French consulting firm, and Merrill Lynch.

High net worth individuals are more numerous and individually wealthy than before the recession.  And within this wealthy group, there is an ultra-rich group with $30 million each available to spend.  They are 1 percent of high net worth individuals, but they hold more than a third of the total wealth of people in this category.

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An obituary for the age of mass affluence

June 29, 2011

Advertising Age reported that the only American income group that increased its spending last year were those earning more than $100,000 a year.  Everybody else is economizing and cutting back.  Consumer demand, according to Advertising Age, is being driven by “a small plutocracy of wealthy elites.”

A recent research report by a firm called Digitas, self-described as “the leading global integrated brand agency,” writes off two-thirds of the people even within the $100,000-plus category.  Unless you are taking in $200,000 or more by age 35, you’re not worth bothering about, Digitas says.  And if you aren’t taking in $100,000 or more a year in your 20s, you have little chance of reaching the $200,000 level.

Digitas recommends that business should concentrate on selling only to the Affluent, Wealthy and Rich, and to the Emerging Affluent, since they have a chance of becoming Affluent, Wealthy or Rich.  The rest don’t count.

During most of the 20th century, it was a proud boast of the United States that the vast majority of the population had access to the same kinds of goods and services as the very rich.  They all could afford similar, though not identical, goods and services – automobiles, refrigerators, TVs, annual vacations at the seashore or in the mountains.  You could not tell the difference between a wealthy person and a middle-class or working-class person by looking at them.

This is still true to an extent.  But unless something changes, we’re moving toward an economy more like that of France in the age of Louis the Fourteenth, in which the vast majority of the population labored at low wages to serve the desires of a wealthy minority.

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