During the speech, which was only 8 minutes long, Jerome Powell slashed the wealth of the richest American people by $78 billion.
In the wake of Federal Reserve Chair Jerome Powell’s speech, the wealth of America’s richest people was reduced by $78 billion. Powell noted during his eight-minute address that the US central bank will maintain raising interest rates and likely leave them high for some time in order to lower inflation.
Elon Musk’s wealth was reduced by $5.5 billion. The biggest loss on the Bloomberg Billionaires Index was incurred by Jeff Bezos, who lost $6.8 billion. While Sergey Brin’s fortune dropped below $100 billion, that of Bill Gates and Warren Buffett saw declines of $2.2 billion and $2.7 billion, respectively.
Powell was observed pushing back on a recent surge in US stocks that was sparked by rumors that policymakers will soon change course from their abrasive monetary tightening while speaking at the Kansas City Fed’s annual policy forum in Jackson Hole.
Powell’s statement is a reminder that the values of large businesses are high by historical standards
The S&P 500 saw its lowest day since mid-June, falling 3.4%. The tech-heavy Nasdaq 100 fell more than 4%, with Microsoft, Amazon, Tesla, and Alphabet among its major constituents.
Powell’s statement served as a reminder that the values of large technology businesses are still high by historical standards following an exceptional run-up during the COVID-19 pandemic when interest rates were anchored near zero.
This year, very few billionaire fortunes have been unaffected. The 500 richest people in the world lost $1.4 trillion in the first half of 2022, the biggest six-month loss in history for the world’s richest people. However, US stocks experienced their greatest monthly gain since November 2020 in July, which encouraged investors to bet that the worst of the market crash was behind them.