Forbes Magazine released its annual list of billionaire’s recently. The list had 1,210 billionaires listed from all over the world. Not shockingly, the USA leads the way on number of billionaires and has half of the top 10. However, a gentleman from Mexico’s telecom industry tops the list and people from India and Brazil take up another 3 spots in the top 10. An analysis of the data adds more credence to Asia being the best place to invest or start a company.



The BRIC countries of Brazil, Russia, India, and China are represented. In fact, China doubled its number of billionaires over last year. Asian countries now make up half of the top ten in number of billionaires. The numbers of billionaires increasing in Asia is good for Asian businesses in terms of possible investors from Asia and the world. Because increasing wealth in Asia fits the narrative of it being a good place to invest your earnings. However, numbers are good, but money is the key.



The United States still leads by quite a large margin, but Asia with Russia, India, China, and Hong Kong also holds a large amount of wealth. Mexico and France join this list with only having 11 and 14 listed billionaires. The upper reaches of wealth are heavily concentrated in these countries. Together Germany and India have 106 billionaires to China’s 115, yet China trails both Germany and India in net worth by about 15 billion USD. China’s wealth is more spread out among its billionaires, so watch for China’s billionaire net worth to move up the rankings. Each Chinese billionaire represents a different industry as well.



This list and all lists like it are always reflected in USD because the USD is the world’s default currency. The 230.4 and 246.5 USD in net worth for China and India’s billionaires will go much further in their countries and other lower cost Asian countries than it would in the United States or Europe where costs are markedly higher.

Purchasing power in Asia and especially in India and China is much higher than in the United States or Europe. Meaning that money goes a lot further in these countries because costs are much lower. The current exchange rate for the Chinese RMB and Indian Rupee to the USD is 6.50 and 44.91. A quick example with a bottle of Coke, it costs $1.50 USD in the United States and 3 RMB in China. When converted to USD the 3 RMB coke becomes $.46 USD. The bottle of Coke in the United States costs 3 times more than it does in China. There are other things to look at as well. Next week I will post an analysis of Purchasing Power Parity to explain this concept in more detail.

A couple of weeks ago, I looked at recent World GDP figures and found that Asian countries were leading the way with growth in the world and no were longer as dependent on the United States and Europe for their growth. This data gives more reasons for why Asia is the place to be for investment in new or existing businesses right now.

M.F.

Sources, Data/Information Links:

Forbes 2011 List of Billionaires
http://www.forbes.com/wealth/billionaires/list?country=&industry=-1&state=

Top 10 Billionaire Count by Country
Top 10 Billionaire Net Worth by Country
http://www.areppim.com/stats/stats_richxgdp_11.htm

China's Billionaire Club
http://www.allvoices.com/contributed-news/8427071-forbes-2011-list-forbes-2011-billionaire-list-2011-forbes-list-of-billionaire

Currency Exchange Rates
http://www.xe.com/