The explosion of private wealth in the world since 2011 has been obvious. This has been cited every year in reports like the Credit Suisse World Wealth Report, and in 2015 alone private wealth as measured by cash and deposit grew by over 10% in the UAE with compounded 14% growth expected across the next 4 years.
At the recent world central bank summit in Jackson Hole in August, it was reported that 25% of the world’s cash was now being held in negative interest in government bonds. In the address of Federal Reserve Chairwoman Janet Yellen and other key international central bankers it was clear that quantitative easing measures started as a result of the last world financial crisis had become an addiction, and instead of a stimulus, quantitative easing has become a fixed part of the world’s economic system.
In the last days the central Bank of Japan has announced that they are trying to avoid negative interest being a permanent part of the country’s economic strategy to spur growth and inflation along with continued quantitative easing, but they like the other major central banks cannot stop printing the money.
The obvious outlook is that this cannot last and a new and much more disruptive crisis is potentially in our future. In the next years those whom take cash and place it in regions where one can own real value will be better protected. Instead of the government bonds giving back less than what was invested, cash in hand now can be property, infrastructure, food and clean energy production in the Eastern Caribbean – which has political, geographical, and environmental advantages in attracting the world’s wealthy. It is also well insulated from some of the worst potential effects of the next world financial crisis.
The Citizens International team has been on the road in South East Asia this week seeing a very positive response to this type of investment narrative. Citizenship status given for this type of investment is the icing on the cake and not the primary reason however having an alternative passport does give the ultimate personal and wealth protection to the wealth clients of our networks internationally.