Joined: 21 December 2008
Meanwhile, as Chengdu Evening News reported on 5th January, we have noticed that 300 out of the 1125 super rich persons on Forbes Magazine's list of billionaires published on March 2008 have lost at least one billion, and there are dozens of others whose wealth have shrunk more than five billion US dollars. The top 10 richest billionaires on Forbes Magazine's list of the world's richest people in 2008 have lost 150 billion in total. The Chinese billionaires Wong Kwong Yu and Larry Yung have been included in the Top Ten Biggest Losers due to the sharp fall in their assets with Wong Kwong Yu's wealth dropped from 3.5 billion US dollars in 2008 to 2.5 billion US dollars, while Larry Yung's slumped from 3 billion US dollars to the present 750 million, dropped by 75%. It has been reported late last year that Yang Hui Yan of Country Garden is the biggest loser; Chairwoman Yan Cheung of Nine Dragons Paper Holdings who is the first female to be included in the list of China's richest people in 2006 also suffers nosedive with a decrease of 8.4 billion US dollars in her net wealth due to the share price of Nine Dragons fell by 86% this year; Xu Rongmao, chairman of real estate developer Shimao Group, lost 4.4 billion while Zhang Li, the Co-chairman of Guangzhou R & F Properties, is estimated to have lost 3.6 billion. News of the world's richest people including China's suffers shrinkage in their net wealth came one after another.
Judging from the general trend of global economy, this is normal phenomenon. Global assets and wealth quickly wiped out in financial crisis. A recently released report of Standard & Poor's points out that the global stock market in 2008 has lost about 17 trillion US dollars market value in the nosedive. In a context where the emerging markets' share prices fell by 54.72% and that of the developed markets dropped by 42.72% in 2008, the sharp fall in the richest people's net wealth makes no surprise.
The shrinkage of the super-rich's wealth is mainly manifested in the evaporation of stocks' market value, especially for those who engage in financial business, real estate enterprises, merger and asset reorganization play. This in fact reflects the huge bubble of virtual economy over the past few years. Since 2001, the world economy has turned impetuous, fanatic and got carried away as other areas in society, which resulted in a large number of entrepreneurs got drunk on virtual economy such as going public, capital reorganization, tender offers and development of new financial products, and invested their fortunes in quick profits seeking industry like real estates, the overheating capital market, high leverage and gamble-like risky futures and products similar to subordinated debt. During this period, economic terms like packing, capital operation and going public became real popular. Moreover, research from replicaestore.com said, the macroeconomic policy's execution of over-liberal monetary policies led to the irrational rising of commodity prices and the surge in stock market and oil prices, pushing the global economy to bubble boom. Some entrepreneurs and rich people are accessories to this bubble boom. It is also the impetuous, fanatic and got carried away world economy that brought up the morbid super-rich.
Bubbles burst eventually as puffy wealth slims down eventually. The economic crisis and financial crisis every time help make the global economy more mature and rational, the votary of wealth sober-minded and understand themselves thoroughly. In editor's opinion, why the crisis this time is so serious is largely because people have got carried away and less alert, and let down their guards to do whatever they like in the economic and financial fields with the wrong idea that economic crisis and financial crisis are histories since there haven't been any in nearly a hundred years time after the 30s of last century.
Many experts come up with a 'three must' summary from this financial crisis: must handle well the relation between virtual economy and real economy, must return focus onto the fundamentals of economy, and must develop virtual economy on the base of well-developed real economy. Even U.S. President George Bush said angrily that Wall Street should stop creating puzzling things (financial products). From this point of view, this crisis is a good thing that it allows people to calm down, bringing them back to the earthy ground from castle in the air to do something practical for the sake of economic development. And no need to feel sorry over the shrinkage of the billionaires' wealth, because perhaps what has vanished is itself the bubbles, the worldly possessions. (Edit by:Louis Vuitton bags Studio - handbagsoutlet.biz Designer Handbags)
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