Matthew Miller and Tom Metcalf New York and London
Billionaires attending the World Economic Forum’s annual meeting in Davos, Switzerland, this week expect to be richer when they return to the Alpine village next year.
About half a dozen of the wealthiest participants, including Aliko Dangote, Africa’s richest person, and Irish telecoms mogul Denis O’Brien, said stocks would rise, interest rates would remain low and they would avoid investing in the virtual currency Bitcoin this year.
“The bull market will continue, we’ve actually turned the corner,” Dangote said at the forum’s Congress Centre on Tuesday. “I believe it’s going to be a whole new ballgame. Things are improving in all sectors: in banking, in vehicle manufacturing, almost all the sectors. And I think we’ve left the bad past behind.”
O’Brien, the chairman of Digicel, the largest telecommunications company in the Caribbean, said he was bullish on equities.”I’m going to stick with global telecom stocks.”
The two are among at least 80 billionaires joining more than 2 500 business and political leaders in Davos, according to a list of attendees and promotional materials.
As billionaires bet on accelerating growth and rising asset prices, income inequality is emerging as a key theme for the week. A study released last week by the forum identified the wealth gap as the most probable menace to the global economy in the next decade.
Wealth disparity – driven by globalisation and the recent financial crisis – threatened to breed poverty and social disorder, it said.
Billionaires attending Davos two years ago said income inequality was an issue they wanted to discuss as the Occupy Wall Street movement grabbed headlines by targeting the world’s richest 1 percent.
The wealthiest people on the planet got even richer last year, adding $524 billion (R5.6 trillion) to their collective net worth, according to the Bloomberg Billionaires Index, a daily ranking of the world’s 300 wealthiest individuals. The aggregate net worth of the 300 billionaires stood at $3.6 trillion at the market close on Tuesday, according to the ranking.
A study by UBS economist Paul Donovan found last month that the pretax income of the top 1 percent of Americans amounted to about 20 percent of all US income, which is comparable with levels in the early 20th century. – Bloomberg