Ultra Rich | Easy Money

Luxury assets of the ultra-wealthy, if that were expensive wine, fancy diamonds, and rare antique cars all had a down year as the stock market ramped to new highs, reported The Wall Street Journal.

In the last decade, luxury assets performed exceptionally well as central bankers handed out free money to the elite class to hoard assets of their liking. And naturally, these people, with exceptional taste, bought things that the common man has only seen on television.

Now, these luxury assets are under performing – have been during the past several years – and is a symptom of late-cycle distress.

“The froth has gone out of the market. People have realized you can’t just buy stuff and expect the value to go up,” said Andrew Shirley, a partner at Knight Frank and editor of the group’s Wealth Report.

The Journal blames the under performance on the global slowdown and the lack of Asian demand. Chinese buyers account for 33% of global luxury goods sales.

“There is a lot of uncertainty in Chinese markets and the riots in Hong Kong didn’t make it easy for people to come spend money in Hong Kong either,” said Eden Rachminov, chairman of the board at the Fancy Color Research Foundation.

Colored diamonds in 2019 lost about 1% in the first three quarters.

Fine wine was also another losing asset through Nov., lost 3.6%, according to the Liv-ex 1000 index.

And the biggest loser on the year were classic cars, lost 5.6%, according to Historic Automobile Group International’s (HAGI) Top Index.

HAGI founder Dietrich Hatlapa said the classic car market has been cooling following a massive rise in price after the 2008-09 financial crisis. He said classic car prices saw double-digit gains after the recession, rallying 50% Y/Y through 2013. “We are at the tail-end of a big bull market,” Hatlapa warned.

What’s becoming evident is that ‘Not QE’ and other monetary gimmicks deployed by central banks are failing to raise asset prices of some luxury goods in 2019. Perhaps the world is stumbling into a period where tool kits of central banks are becoming less responsive to stimulate asset price inflation, and if that is the case, then everyone will figure out that prices of luxury goods have been hyper inflated over the last decade with nothing but hot air.

Source: ZeroHedge

A new survey lists the states with the highest number of ultra rich

CA US Senior Senator Dianne Feinstein’s net worth estimated at over $40 million

Which U.S. state has the wealthiest residents of them all? It’s the home state of Facebook Chief Executive Mark Zuckerberg but not America’s richest man, Bill Gates, who lives in the state of Washington.

California is the state with the highest number of ultra wealthy individuals, according to a report from private wealth consultancy Wealth-X. There are 13,445 ultrahigh-net-worth individuals — defined as those with $30 million and above in net assets — based in the Golden State, up 6% on a year-over-year basis. They’re mostly located in San Francisco (5,460 people) and Los Angeles (5,135). In fact, California’s population of ultra wealthy individuals is larger than the ultrawealthy population in the entirety of the United Kingdom (11,510).

Facebook founder Mark Zuckerberg: Born in New York state, resides in California.

Other states are experiencing a super-rich surge. New York was No. 2 on the list, with 9,530 ultrahigh-net-worth individuals in 2014, up 6% in the last year, and — perhaps unsurprisingly — 8,655, or 91%, of them were based in New York City. The population of people with $30 million or more rose 14% on a year-over-year basis to 80 in North Dakota, which is currently experiencing an energy oil boom. Florida’s ultrahigh-net-worth population increased by more than 10%, adding almost 500 new individuals to 4,710 in 2014 due to strong growth in the state’s financial and real-estate sectors.