A study published on Wednesday indicates that the world has never had so many wealthy individuals, with their investments in booming stock markets making them richer than ever before. According to consulting firm Capgemini, the number of “high net worth individuals” (HNWI) — those with liquid assets of at least $1 million — increased by 5.1 percent last year, reaching 22.8 million.
Their collective wealth amounted to $86.8 trillion in 2023, reflecting a 4.7 percent rise from the previous year, as noted in the annual World Wealth Report.
Both the number of HNWIs and their total wealth are the highest recorded since Capgemini began this annual study in 1997.
Their fortunes have grown alongside stock market surges: New York‘s tech-focused Nasdaq climbed 43 percent in 2023, while the broad-based S&P 500 rose by 24 percent.
The Paris CAC 40 increased by 16 percent and the Frankfurt DAX by 20 percent.
Impact of macroeconomic instability and geopolitical tensions in 2022
In 2022, the number of HNWIs and their wealth had decreased by more than three percent due to macroeconomic instability and geopolitical tensions, according to the report.
This decline in wealth was the sharpest in a decade as stock values dropped.
“However, 2023 brought economic growth and improved fortunes for major investment sectors to reverse the falloff,” the report said.
“Despite ongoing interest rate uncertainty and rising bond yields, equities surged along with the tech market, fueled by enthusiasm for generative AI and its potential impact on the economy.”
The rise in wealth and increasing inequality have spurred debates on ensuring the rich pay their fair share of taxes.
Countries like Brazil and France have urged their G20 counterparts to establish a global minimum tax for the world’s wealthiest individuals.