7 minutes agoWhy do rich people get richer even during global crises?
Periskopi(3 years ago)
(3 years ago)Death and destruction are not the only cards that will be remembered COVID-19. Pandemia has also drastically expanded inequality across the globe over the past three years. According to Bloomberg billionaires' Index, 131 billion more than doubled their net value during the pandemic. The richest person [...]
Death and destruction are not the only cards that will be remembered COVID-19. Pandemia has also drastically expanded inequality across the globe over the past three years.
According to Bloomberg billionaires' Index, 131 billion more than doubled their net value during the pandemic.
The world's richest person, Louis Vuitton's chief Bernard Arnault, had a fortune of $159 billion on December 27, 2022, with about $60 billion compared with the beginning of 2020.
Elon Mousk, the second richest man on the planet, boasted of a $ 139 billion fortune - something less than $50 billion before pandemic.
And India's Gautam Adani, the third in the index, has seen its wealth increase more than tenfold in this period, from approximately $10 billion in early 2020 to $110 billion at the end of 2022.
At the same time, close to 97 million people more than any European nation's population were pushed into extreme poverty in 2020 alone, earning less than $1.90 a day (the poverty limit set by the World Bank).
The global poverty rate is estimated to have increased from 7.8 percent to 9.1 percent by the end of 2021. Now, rising inflation in the sky is affecting real wages, eating people's available income worldwide.
To curb price hikes, central banks are reducing the flow of money into the economy by increasing interest rates and attracting excess liquidity.
But this has hit workers again, with companies from technology firms like Amazon, Twitter and Meta to banks like Goldman Sachs announcing layoffs at the end of an already troubled 2022.
“Al Jazeera” spoke with economists to understand why the rich continue to get rich even amid crises and whether it is inevitable whenever there is an economic slowdown.
Short answer: Many countries adopt policies such as tax cuts and financial incentives for businesses to promote economies amid crises such as pandemics.
Central banks flood the economy with money to make lending and spending easier.
This helps rich people to raise their money through financial market investments. But expanding inequality is not inevitable.
