Friday, March 13, 2009

Biggest billionaire losers—and some winners

Feeling down about the hits your 401K has suffered during the last year? Well, as they say in Minnesota, it could be worse … a lot worse.

March 12, Forbes released its list of the world’s billionaires. This year, the list sits at 793, down from 1,125 in 2008. “The typical billionaire is down at least one-third in their net worth,” said Steve Forbes, Forbes CEO. That includes Microsoft founder Bill Gates, who lost $18 billion—30 percent of his worth. Despite the losses, he did manage to reclaim the title of the world’s richest person with a total worth of $40 billion. Phew.

Forbes highlighted the biggest billionaire losers, including K.P. Singh, who lost 83 percent of his net worth. The driving Indian real estate boom made Singh the world’s richest real estate baron, a title he held for a very hot minute. The real estate market crash and the slowdown of the Indian economy caused Singh’s net worth to drop $25 billion during 2008. His current net worth is $5 billion.

Those sky-high metals prices that squeezed the glass industry during 2006-2007 gave a big boost to the net worth of Russian aluminum tycoon Oleg Deripaska. In turn, the sharp decline in demand for aluminum, nickel and copper as a result of the credit crunch and overall manufacturing slowdown caused Deripaska’s worth to plunge $24.5 billion to $3.5 billion.

The end of the Las Vegas building boom hit Sheldon Adelson hard. The Sin City property developer lost $22.6 billion during the year, falling to a net worth of only $3.4 billion, an 87 percent loss. Ouch.

Despite the economy, some rich managed to get richer during the year, according to the Forbes list of winners. Forty-four billionaires increased their worth, and 38 new billionaires made the list. The top three earners include: New York Mayor Michael Bloomberg, who managed to increase his net $4.5 billion to $16 billion; John Paulson, a hedge fund manager who predicted the U.S. economic plunge, doubling his net worth to $6 billion; and mathematician turned stock-market-algorithm developer, James Simons, who saw $2.5 billion in gains last year, bringing his net worth to $8 billion.

According to a National Public Radio report, Forbes and the magazine’s editor Matthew Miller offered some insight on what the winners did right. Location became a huge factor, differentiating winners and losers, Forbes said, as most billionaires that fell off of the list came from emerging markets such as India and Russia. The best place to live is “still in the United States,” Forbes said.

Miller added that the earners invested in the tangible, such as John Paul DeJoria who owns Paul Mitchell shampoos and Patron Tequila. “Liquor is something people like in a recession,” he said.

Forbes said future billionaires will be those who capitalize on the current economic situation and work to create something better.

Katy Devlin, commercial glass & metals editor, retail glass co-editor, Glass Magazine

1 comment:

Anonymous said...

These people are still billionaires and they will be fine, I do not feel sorry for them at all. My 401k is worth less than $5,000 now! What are people like me gonna do when our retirement funds vanish like a fart in the wind? Work until we Die?