New York (AFP)
Panic has spread to financial markets across the globe this week, with Wall Street experiencing its worst session since the stock market crash in October 1987.
Even though there was a spectacular rebound during Friday's session, tens of thousands of billions of dollars in market capitalization went up in smoke.
"We have fallen after having gone up extremely in the last ten years. It sounds brutal but it must be said that the stock market has taken three steps forward and one step back", summarizes Gregori Volokhine, portfolio manager at Meeschaert Financial Services.
Here are the big losers from the stock market crash:
- The most rich
The billionaires, whose fortunes are invested in the equity markets, particularly in the companies they manage or in which they are the main shareholders, are those who have lost the most.
Jeff Bezos, the richest man in the world, saw his fortune invested in Amazon melt, from 117 billion dollars last weekend to 109 billion Friday, or 8 billion dollars less in seven days, according to real-time figures from Forbes magazine.
The fortune of Bill Gates, the co-founder of Microsoft, it went in a week from 108.2 billion to 103 billion Friday, down 5.3 billion.
Frenchman Bernard Arnault, the third richest man in the world and CEO of LVMH, lost 14 billion in one week to 84.6 billion.
Businessman Warren Buffett, "Oracle of Omaha", was penalized by the rout of the airlines, of which his group Berkshire Hathaway is a major shareholder. His fortune went from 81.6 billion at the end of last week to 76.3 billion on Friday.
Mark Zuckerberg, who completes the top 5, saw his wealth decrease from $ 9.2 billion to $ 62 billion in the wake of Facebook's stock market downturn.
All these losses are nevertheless virtual because the big fortunes have not sold their securities and will therefore be able to regain the money lost if the markets recover.
- Retirees, future retirees and annuitants
Panic in the markets has led a large number of investors to take refuge in so-called safe assets such as debt securities, and in particular American debt.
This rush caused the fall in yields on these bonds, which affects conventional life insurance and life insurance contracts with variable annuities, part of the amount invested in the subscription grows according to the results of the stock exchange until 'upon retirement of the insured.
The 30-year Treasury bill rate, the longest term, was 1.5% on Friday.
- Small holders and savers
The number of American households owning shares, directly or via funds, was, according to the last Federal Reserve survey on the subject, of 51.9% in 2016. It is more than one in two Americans.
These assets are often contained in 401 (k) retirement savings plans.
Individual investors will therefore have a bad surprise when they receive their next statement. They will no doubt see that their virtual "fortune" has decreased drastically, which is likely to influence their consumer behavior. Consumption is the engine of the American economy.
"They are no longer going to buy the latest iPhone model they had planned to buy and this is where the impact will last," said Volokhine.
- Pension funds
Their losses are also essentially virtual because they do not sell their securities and invest for the long term.
The portion of their assets invested in equities has suffered enormously, and the portion invested in bonds has yielded less because yields have declined.
There is a third part of the assets, the performance of which is unknown: the money entrusted to hedge funds and private equity firms.
We will have to wait until the end of the first quarter to have a clear idea of the losses linked to this third section because the funds publish their performances quarterly.
- Entertainment, leisure and catering
While a large number of companies will experience a one-time shortfall, this will not be the case for the film, theater, cruise, travel and restaurant industries, which will not be able to make up for lost expenses.
Disney is one of the big losers.
© 2020 AFP