The Julius Baer Wealth Report

Here is the link to the 2013 Julius Baer Wealth Report, detailing the Swiss private bank's analysis and insights into wealth trends and consumption patterns among Asia’s wealthy. It’s chock full of interesting statistics and charts. Here is a sampler:

A Rich De-Couple

Link to SCMP article on China's and Hong Kong's pace of wealth growth

Above are two recently published charts (from Swiss private bank Julius Baer and the BCG consulting group) that essentially tell the same story – that Asia’s wealth creation continues to outpace the rest of the world, and the ranks of US$ millionaires (excluding property) continue to swell throughout the region, particularly in China. China now has over one million millionaires, and that figure is expected to grow by a staggering 15% per year through 2015. That growth rate leaves every other mature economy in the dust, including Hong Kong, which is expected to grow millionaires at 8% per year. "Asia's growth and wealth creation engine has de-coupled from mature economies, and there are clear indications that China, in particular, is moving up the value chain," says Stefan Hofer, emerging market economist at Julius Baer.

A consequence of all this proliferating good fortune is the higher inflation rate of prices of “luxury” related goods and services. In Shanghai, prices for high end goods rose on average by 10% last year. University education costs at elite universities in the US have jumped by an eye-popping 30%. Fine wine rose 16% in price.

In economic and financial parlance, “de-coupling” refers to a phenomenon whereby two forces that were once tightly correlated (in this case, Asian wealth and US/European wealth) no longer become so. Since the 2008 economic crisis and with the subsequent Euro crisis, the steady churning of wealth in Asian countries has decidedly had a different trajectory than in the West. Sadly, however, indicators such as the Gini coefficient are showing that the fortunes of those already well off are also de-coupling from the “have nots'”. This widening gap is one that we should all hope also de-couples (and reverses) in the future from present realities.

My Home, My Gallery

Romi Lamba and a feast for the eyes

This linked SCMP article on Romi Lamba, which appeared in this morning’s Sunday Post Magazine in Hong Kong, provides a first-person account of a unique man with a unique collection of Asian art. Romnesh Lamba (known to all as Romi) is a senior executive at the Hong Kong Exchanges and Clearing, or simply, the Stock Exchange. Unlike so many other finance personalities around Asia, he is less defined by his wealth as by his passions. Collecting Asian contemporary art, particularly from India and China. has occupied much time and energy for him and his wife for many years. Visitors to their home often liken it to a gallery as much as a personal residence where the couple have raised two daughters. Furthermore, having consistently been ahead of the curve and a thorough student of Asian art trends, the Lambas have undoubtedly done well financially as well as aesthetically with their collection. It is reassuring to witness that taste and success sometimes do indeed go hand in hand. 

The Deal of the Art

Look at that price tag. Not THAT’s creative!

The inaugural edition of Art Basel Hong Kong has now come and gone. The general consensus is that the contemporary art fair was a resounding success. The branding with Art Basel (in previous years, the annual event was known simply as Art HK) had a clear impact on the image and positioning of the fair. The galleries attending were more carefully selected. Celebrities such as Kate Moss flew in to have a look around. The detailing of how the space was laid out was just a tad more polished than before. All in all, it felt like an important step forward in helping Hong Kong set itself further apart from other rival cities in Asia as the continent’s most open, cosmopolitan hub for international culture.

Naturally, this being Hong Kong, the event was perfumed liberally with the distinct fragrance of money. There was an uptick in the visibility of luxury brand sponsors. The Intelligence Squared debate that took place during the fair posed the theme “The Market is the Best Judge of Art’s Quality” (Note: the consensus before and after the debate was “no”). However, the buying mood wasn’t frenzied, as has been the case in recent years with Asian wine auctions, real estate or luxury products. Buying activity was measured and studied. And there were plenty of attendees from the general public present simply to enjoy the art, have the kids run around a bit, and escape the humidity and thunderstorms that dominated last week’s weather. If Hong Kong can continue to grow its art appreciation market without resorting to hot money fever (or worse, the use of art as a vehicle for money laundering), it will indeed be an artful achievement.  

New York Times article of Art Basel Hong Kong

Jing Daily recap of Art Basel Hong Kong

Forbes: Asia’s Most Powerful Women

China’s First Lady at #54. Flexing arm candy.

Here is the link to the Forbes magazine list of 100 most powerful women for 2013. The table below is a distillation of the Asian women from the list. It’s an interesting mix of political, business, non-profit and NGO organizations.

A Bus Detour from the Road to Riches

Let me take you on the road less traveled.

This South China Morning Post article profiles a young finance professional who gave up a promising career as a future Hong Kong one-percenter to pursue a self-proclaimed dream – to be a full-time local bus driver. Gary Leung, 26, decided that chasing money and luxury did not represent a “fulfilled life” for him, despite a strong educational background that had prepared him to be a financial analyst. So he enrolled for an additional 18 days of driver training and then took the wheel of a KMB vehicle. He says that he hopes to inspire people to think differently about their lives and what moves them (pun intended). His story has gone viral online, with some people criticizing him that he can make this choice because he has the privileged background to do so.  Whatever his true motivations, it’s a thought provoking case study of an alternative lifestyle choice. All aboard?

Writing About Riches

Oh look, a sale on books about us!

Here’s a link to an Elle Magazine article written by Janice Y.K. Lee, bestselling author of The Piano Teacher, that profiles some of Asia’s super rich. The piece includes amusing anecdotes about people partyin’ with the English Queen and concocting imaginative ways to keep a maid staff busy. It also has useful statistics about the rise of the region’s uber-class. Most interestingly for me, she highlights the growing trend of well-written literature that focuses on the skyrocketing Asian wealth. The novels are inescapably either poignant, border on satire, or balance between the two. She highlights Five Star Billionaire by Malaysian Tash Aw, How to Get Filthy Rich in Rising Asia by Mohsin Amid (Pakistan), and Crazy Rich Asians by Kevin Kwan (Singapore). Given how new wealth is upturning societies, family dynamics and morality across Asia, it’s not surprising that this topic is inspiring new writings and readers looking for fresh story lines and characterizations that are, well, rich.