Credit Suisse has predicted a 40% rise in wealth in just five years, but this cant happen without repercussions. Is another crash on its way?
In its latest report on global wealth, Credit Suisse describes the UK as a country that enjoyed stable income-to-wealth ratios for the first 70 years of the last century and an evening out of the distribution of money across the population for most of that period. The average household came to have assets worth between four and five times their income, and more households were nearer that average than ever before.
That stability ended during the 1980s. Apparent wealth grew rapidly and became more concentrated among a few households. The housing market and equity in shares boomed for most years until 2007. By that point, the average household had nine times as much wealth as average income, double the ratio reported some 25 years earlier, but there were far fewer average households. The country appeared richer, but it was in riches increasingly held by the few.
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