Billionaires showered with wealth as experts say global economy set for long and deep recession

New study shows pandemic drove up profits for some...

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The word “unprecedented” is getting banded about so much these days that it is losing its meaning. It is worth remembering, then, that even seasoned commentators have been left slack-jawed by the continuing economic poo-narmi.

As one financial journalist said on Twitter earlier this week: "That scene in Event Horizon where Sam Neill grabs Laurence Fishburne's head and shows him a vision of hell...that how I'd sum up the economic data out of Europe today."

But it's not all bad. At least, not if you are a billionaire. According to a study by the Institute for Policy Studies, the US scholar-activists thinktank, between January 1, 2020 and April 10, 2020, 34 of the nation's wealthiest 170 billionaires have seen their individual wealth increase by tens of millions of dollars.

The leader of the pack was that figure we all know and love, Amazon founder and CEO, Jeff Bezos. His wealth surge is "unprecedented in the history of modern markets," the study said. It has climbed $12bn since February 21st, 2020, the start of the COVID-19 pandemic.

Now, you might say that Amazon is particularly well-placed to do well during the crisis because of its ability to send laptops and loo roll to millions of locked down individuals worldwide. But Bezos is not the only billionaire to benefit from the COVID-19 forced quarantine and social distancing.

Meanwhile, former Microsoft CEO Steve Ballmer, who is now retired, woke up one April morning with a satisfying feeling in his bowels telling him his wealth had increased by $2.2bn. Probably. The $2.2bn part is true anyway.

We come inevitably to Elon Musk. It's not as if space travel and electric cars have become vital resources since the nasty viral entity reared its ugly head, yet, that famous expert on subaquatic cave rescues, rolled out of bed, logged onto Twitter and found his wealth had climbed by $5bn.

The study found combined billionaire wealth increased by 9.5 per cent in just 23 days during the COVID-19 crisis. By April 10, their wealth had surged to $3.2 trillion, surpassing the 2019 level.

It is a long-term trend. Billionaire wealth tends to return more rapidly after a financial crisis than the overall economy. Within 30 months of the September 2008 crash, most billionaire fortunes had recovered. And between 2010 and 2020, the combined wealth of the US billionaire class surged by a staggering 80.6 per cent, said the Institute for Policy Studies.

Makes it a bit less tolerable to listen to the politicians, many of whom are backed by a few of the mega-rich, with the brass neck to stand at a lectern and say: "We're all in this together."

"We are likely to see a deeper contraction in 2020 than during the global financial crisis. But so much depends on what comes next: how long the suppression measures last, what medical science can deliver, what further policy support is available," Janet Henry, global chief economist at HSBC told Reuters.

Here's hoping those measures work. ®

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