Carlos Slim, the world’s richest man, lost around $US6.7 billion last week.
According to data compiled by Bloomberg, Slim’s stock portfolio has fallen 9.5 per cent since July 29 when measured in US dollars, and is now valued at $64.4 billion.
The Standard & Poor’s 500 has fallen 7.2 per cent during that time.
Slim, 71, has taken a hit as Mexico’s benchmark IPC index dropped 6.4 per cent and the peso slid 2.3 per cent against the dollar on concerns that the flagging US economy will hurt demand for assets in its southern neighbour.
The removal of three of Slim’s companies from the IPC index has made matters worse for the billionaire.
Leon Cabrera, a trader at Mexico City-based Vanguardia Casa de Bolsa, told Bloomberg that Slim was ‘‘particularly hurt’’ by the companies that were removed from the IPC.
When Slim’s holding are measured in Mexican pesos, the drop in value was somewhere around 7.3 per cent.
Mexico telecoms czar Carlos Slim topped the Forbes annual world's richest list Wednesday, sporting a $US69 billion ($65 billion) fortune that while down from last year still outpaced the runner-up, Microsoft founder Bill Gates.
Forbes said 1,226 tycoons made it onto its global list of billionaires this year, but Slim held onto the top spot for the third straight year, with $US7 billion more than Gates.
In the third spot was US investment guru Warren Buffet, worth $US44 billion; followed by France's luxury king Bernard Arnault, $US41 billion; and a newcomer to the top five, Spain's Amancio Ortega, the owner of the Zara fashion chain, whose net worth surged by $US6.5 billion to $US37.5 billion despite Europe's financial straits.
Despite the sluggish world economy, Forbes said, the billionaires' list grew: there were 128 newcomers while 117 dropped off, with an average net worth of $US3.7 billion, unchanged from last year.
A separate survey of billionaires by Bloomberg earlier this week named Australia's Gina Rinehart as the fourth-richest person in the Asian region, with wealth of about $19 billion. Forbes ranks her the 29th richest person in the world, with a fortune of $US17 billion, and the only Australian to make the top 100.
The 40 richest individuals on Earth lost a combined $US6.2 billion ($5.99 billion) yesterday as stocks dropped amid disappointing US earnings, according to the Bloomberg Billionaires Index, a daily ranking of the wealthiest people.
Saudi Prince Alwaleed bin Talal joined the index, which doubled the number of billionaires it tracks yesterday. Alwaleed's fortune has increased 18.2 per cent, or $US3.2 billion, this year, as shares of his Kingdom Holding Co, a diversified investment group that is planning to build the world's tallest tower, rose 36 per cent. The 57-year-old ranks 24th on the index with a net worth of $US20.5 billion.
"There is no secret to success," Alwaleed said. "It is based on a sound investment strategy, commitment and long-term vision."
The Bloomberg Billionaires Index takes measure of the world's wealthiest people based on market and economic changes and Bloomberg News reporting. Each net worth figure is updated every business day at 5:30pm in New York. The valuations are listed in US dollars.
The expanded list was published with the release of new billionaires profile pages in the Bloomberg Professional service. The profiles feature a transparent analysis of how each billionaire's fortune was calculated.
Alwaleed's fortune makes him richer than Google co-founders Larry Page and Sergey Brin. Page ranks in 29th place with $US18.9 billion, while Brin ranks 32nd on the list compiled by Bloomberg News. He is worth $US18.7 billion.
The combined wealth of the index is $US1.1 trillion. The 40 billionaires have gained a combined $US88.2 billion since the beginning of the year.
Mexican telecommunications magnate Carlos Slim, 72, remains the richest person in the world, with a fortune of $US68.8 billion, down $US572.3 million for the day. Second is Microsoft co-founder Bill Gates, 56, with $US62.7 billion, followed by Warren Buffett, who's worth $US44.6 billion.
Buffett, 81, the chairman of Berkshire Hathaway, said in an April 17 letter to investors that he has been diagnosed with stage 1 prostate cancer that is "not remotely life threatening."
Mark Zuckerberg, the 27-year-old founder of Facebook, the world's largest social-networking company, is 25th on the ranking. Based on a roughly $US100 billion valuation the Menlo Park, California-based company was trading at in the private market when it ceased trading April 3, Zuckerberg may be worth $US20.5 billion, or about 25 per cent less than previous estimates, once Facebook holds its initial public offering.
The reason: Facebook will issue more than 500 million shares of its Class B stock at the offering, diluting Zuckerberg's ownership to 21 per cent after he exercises 120 million options and sells about 42 million shares to cover the tax bill associated with the gain from those options.
Lee Shau Kee, who has said he would swap 99 per cent of his wealth for 30 years of time, ranks 26th in the world and second in Hong Kong with a net worth of $US19.8 billion. Lee, 84, has gained $US2.6 billion this year after shares of Henderson Land Development, the developer he founded, rose 17 per cent.
Cheng Yu Tung, the third-richest person in Hong Kong, has a net worth of $US18.8 billion. The owner of Chow Tai Fook Jewellery Group and property company New World Development, 60, is ranked 30th in the world. His net worth is down 6.2 per cent so far this year.
Lakshmi Mittal, the India-born chairman of ArcelorMittal, the world's biggest steelmaker, is in 28th place with $US19 billion. In addition to his 41 per cent stake in ArcelorMittal, the 61-year-old London resident owns hundreds of millions of dollars in UK real estate.
Gina Rinehart, the Australian mining heiress, is worth $US18.7 billion, putting her in 31st place on the index. Rinehart, 58, the daughter of the man who discovered the mines that made Australia the world's biggest iron ore exporter, owns perpetual royalty rights to some of Rio Tinto's Hamersley mines in addition to other iron-ore and thermal coal deposits throughout the country.
Three of her four children have taken legal action in an effort to remove her as guardian of the family trust. Last month, she lost a bid to keep details of the family litigation private. Newly released documents indicate her four children may have a stake worth as much as $US4.7 billion in the trust.
Li Ka-shing, 83, ranks as the richest person in Asia with a net worth of $US23.9 billion.
The 40 richest individuals on Earth lost a combined $US6.2 billion ($5.99 billion) yesterday as stocks dropped amid disappointing US earnings, according to the Bloomberg Billionaires Index, a daily ranking of the wealthiest people.
Saudi Prince Alwaleed bin Talal joined the index, which doubled the number of billionaires it tracks yesterday. Alwaleed's fortune has increased 18.2 per cent, or $US3.2 billion, this year, as shares of his Kingdom Holding Co, a diversified investment group that is planning to build the world's tallest tower, rose 36 per cent. The 57-year-old ranks 24th on the index with a net worth of $US20.5 billion.
"There is no secret to success," Alwaleed said. "It is based on a sound investment strategy, commitment and long-term vision."
The Bloomberg Billionaires Index takes measure of the world's wealthiest people based on market and economic changes and Bloomberg News reporting. Each net worth figure is updated every business day at 5:30pm in New York. The valuations are listed in US dollars.
The expanded list was published with the release of new billionaires profile pages in the Bloomberg Professional service. The profiles feature a transparent analysis of how each billionaire's fortune was calculated.
Alwaleed's fortune makes him richer than Google co-founders Larry Page and Sergey Brin. Page ranks in 29th place with $US18.9 billion, while Brin ranks 32nd on the list compiled by Bloomberg News. He is worth $US18.7 billion.
The combined wealth of the index is $US1.1 trillion. The 40 billionaires have gained a combined $US88.2 billion since the beginning of the year.
Mexican telecommunications magnate Carlos Slim, 72, remains the richest person in the world, with a fortune of $US68.8 billion, down $US572.3 million for the day. Second is Microsoft co-founder Bill Gates, 56, with $US62.7 billion, followed by Warren Buffett, who's worth $US44.6 billion.
Buffett, 81, the chairman of Berkshire Hathaway, said in an April 17 letter to investors that he has been diagnosed with stage 1 prostate cancer that is "not remotely life threatening."
Mark Zuckerberg, the 27-year-old founder of Facebook, the world's largest social-networking company, is 25th on the ranking. Based on a roughly $US100 billion valuation the Menlo Park, California-based company was trading at in the private market when it ceased trading April 3, Zuckerberg may be worth $US20.5 billion, or about 25 per cent less than previous estimates, once Facebook holds its initial public offering.
The reason: Facebook will issue more than 500 million shares of its Class B stock at the offering, diluting Zuckerberg's ownership to 21 per cent after he exercises 120 million options and sells about 42 million shares to cover the tax bill associated with the gain from those options.
Lee Shau Kee, who has said he would swap 99 per cent of his wealth for 30 years of time, ranks 26th in the world and second in Hong Kong with a net worth of $US19.8 billion. Lee, 84, has gained $US2.6 billion this year after shares of Henderson Land Development, the developer he founded, rose 17 per cent.
Cheng Yu Tung, the third-richest person in Hong Kong, has a net worth of $US18.8 billion. The owner of Chow Tai Fook Jewellery Group and property company New World Development, 60, is ranked 30th in the world. His net worth is down 6.2 per cent so far this year.
Lakshmi Mittal, the India-born chairman of ArcelorMittal, the world's biggest steelmaker, is in 28th place with $US19 billion. In addition to his 41 per cent stake in ArcelorMittal, the 61-year-old London resident owns hundreds of millions of dollars in UK real estate.
Gina Rinehart, the Australian mining heiress, is worth $US18.7 billion, putting her in 31st place on the index. Rinehart, 58, the daughter of the man who discovered the mines that made Australia the world's biggest iron ore exporter, owns perpetual royalty rights to some of Rio Tinto's Hamersley mines in addition to other iron-ore and thermal coal deposits throughout the country.
Three of her four children have taken legal action in an effort to remove her as guardian of the family trust. Last month, she lost a bid to keep details of the family litigation private. Newly released documents indicate her four children may have a stake worth as much as $US4.7 billion in the trust.
Li Ka-shing, 83, ranks as the richest person in Asia with a net worth of $US23.9 billion.
These people owned telecommunication companies, oil fields, hotels, shopping centres, share portfolios, gold, property investments, airplanes, cash, bonds, and a whole host of assets that we can only dream about.
Dare I say that they will still own those assets in 10 years time and won't give a hoot that values have fallen during this current downturn.
The losses are unrealised, as are the profits on the original purchase.
Any expressed market opinion is my own and is not to be taken as financial advice
These people owned telecommunication companies, oil fields, hotels, shopping centres, share portfolios, gold, property investments, airplanes, cash, bonds, and a whole host of assets that we can only dream about.
Dare I say that they will still own those assets in 10 years time and won't give a hoot that values have fallen during this current downturn.
The losses are unrealised, as are the profits on the original purchase.
Not true. While many on the list have long held on to a core holding in a company closely associated with their fortune, the companies themselves (presumably at the direction of their founders) are often keen asset traders.
Warren Buffett (#3 overall) and Li Ka-shing (#1 in Asia) certainly fall into this category. Bernard Arnault (#1 in Europe) started off in construction (in France), switched to real estate development (in Florida), was a corporate raider for awhile, and then devoted himself to building LMVH. Closer to home, the Packers have been famous for trading core holdings, most notably in the case of Kerry Packer selling the Nine Network to Alan Bond, and then buying it back later for a quarter of the price.
There are some buy-and-hold types on the list, e.g. Carlos Slim, but their core assets are anything but underperforming. In Mr. Slim's case, he holds a near monopoly on mobile phone service for the entire country of Mexico (population 115M).
Indeed, I think it is rather difficult to get on this list (unless one inherits the position) by sitting on underperforming assets for any extended period of time.
These people owned telecommunication companies, oil fields, hotels, shopping centres, share portfolios, gold, property investments, airplanes, cash, bonds, and a whole host of assets that we can only dream about.
Dare I say that they will still own those assets in 10 years time and won't give a hoot that values have fallen during this current downturn.
The losses are unrealised, as are the profits on the original purchase.
Not true. While many on the list have long held on to a core holding in a company closely associated with their fortune, the companies themselves (presumably at the direction of their founders) are often keen asset traders.
Warren Buffett (#3 overall) and Li Ka-shing (#1 in Asia) certainly fall into this category. Bernard Arnault (#1 in Europe) started off in construction (in France), switched to real estate development (in Florida), was a corporate raider for awhile, and then devoted himself to building LMVH. Closer to home, the Packers have been famous for trading core holdings, most notably in the case of Kerry Packer selling the Nine Network to Alan Bond, and then buying it back later for a quarter of the price.
There are some buy-and-hold types on the list, e.g. Carlos Slim, but their core assets are anything but underperforming. In Mr. Slim's case, he holds a near monopoly on mobile phone service for the entire country of Mexico (population 115M).
Indeed, I think it is rather difficult to get on this list (unless one inherits the position) by sitting on underperforming assets for any extended period of time.
Within large portfolios, assets will be bought and sold as they would in any market, but an asset sold and an asset thus bought is probably a zero sum gain if it weren't for the keen minds of the business owners, who will probably make more in this downturn (end result) than they would otherwise have made when markets had few distressed assets. Had they not made a trade, they would probably still be ahead, but perhaps not by as much.
Alan Bond sold a television network back to Kerry Packer at a substantial loss because he couldn't meet his obligation from cashflow, which had until that moment included continuous asset value gains. He had insufficient working income generated from day to day trading, and the creditors knew that.
I noted your comments from the other day when you outlined the various typical scenarios, and I don't disagree that the individuals financial position, in particular his or her cashflow position will impact on their capacity to ride out the financial crisis. But in situations where cash flow either from normal wages or corporate income is not impacted, it is unlikely that there will be long term losses resulting from changes in asset values alone, it would need a loss of income to cause a problem.
In fact I would wager a cheap bottle of red that the tycoons that you mentioned will be even wealthier in 2022 (assuming longevity) than they are today.
And so it also goes with ordinary homeowners. Some won't give a toss and they will continue to reside in their home, raise their children, and they too will have accumulated more wealth by 2022 simply by doing nothing different.
Those who are exposed because they don't have sufficient cashflow to maintain their property holding will lose, but in better times their only salvation was rising prices, not business acumen. To suggest that a homeowner should sell and buy back into the market is a risky recommendation given the high transaction costs for property. If you want assets to trade quickly and with a low cost then shares will beat property any day of then week.
For a householder who has no need to sell, staying put is a no brainer. The more difficult decision rests with someone who would like to buy but isn't sure whether they should buy now, or wait because house prices may drift lower. It's no different to any other asset purchase decision at a time of market volatility, but the average person doesn't make decisions of this magnitude every day.
It's a tough decision, and it's their decision alone to make.
However an unrealised gain or loss is not a gain or a loss until it is crystalised by a sale.
Any expressed market opinion is my own and is not to be taken as financial advice
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