The Melting of Billions – The Courier

It’s the waltz of billions of dollars, euros, pounds sterling, yen and francs disappearing. The slump in stock markets, particularly since the beginning of this year, is taking a serious toll on the fortunes of billionaires, particularly the big bosses of tech giants. Of the 20 global fortunes that have fallen the most since the beginning of the year, 14 are linked to digital technology giants, according to the Bloomberg Billionaires Index.

But why her? The Elon Musks, Jeff Bezos, Larry Page, Sergey Brin and others are not only the bosses of phenomenally successful companies like Tesla, Space X, Amazon and Alphabet (Google), which belong to the world giants of technology. They also embody what made the decade 2010-2020 so successful, namely the meteoric rise of digital technologies and automation with the help of free money.

The end of free money

Why her? “They are the reference shareholders of companies whose value has risen sharply in recent years thanks to ultra-accommodative central bank monetary policies, leading investors to favor growth company stocks. The about-face by central banks since last winter, which are now tightening monetary policy, particularly by raising interest rates to fight inflation, has caused them to fall more than the average for listed companies, according to Nils Tuchschmid, professor at the Haute Ecole de gestion (HEG ) in Friborg (see below).

On January 1st of this year, Jeff Bezos, Amazon’s founder and reference shareholder, was credited with a net worth of $192 billion. Half a year later, at the end of June, it had fallen by almost a third or $57.1 billion to no longer “just” $135 billion.

The Swiss are also affected by this major slump in assets

Of course, Jeff Bezos’ wealth still represents more than 600 times the average wealth of every Swiss person (CHF 215,000 according to the Federal Tax Administration). But the size of its loss in six months accounts for almost 80% of the federal annual budget (80 billion francs excluding Covid). The reason is simple: Amazon’s stock value has fallen 34.5% in six months. And Jeff Bezos isn’t even the one who lost the most. He was overtaken by Mark Zuckerberg, who was less rich to begin with!

The Facebook founder’s (now Meta) fortune has shrunk by $64.9 billion since the start of the year. And for him, that loss must be harder to take because it’s more than half of what he had at the end of last year! Currently, the total fortune is only $60.6 billion. The cause: Since January 1, Meta’s stock market value has fallen by 51.5%. And the list is long.

Elon Musk would have lost 55.3 billion, Larry Page and Sergey Brin together 46.7 billion, Bill Gates 22 billion, Larry Ellison 19 billion… by falling Tesla by 41.9%, Alphabet (parent of Google) by 20, 2%, Microsoft by 22.4% and Oracle by 19.5%. But it gets worse: Chinese-Canadian Changpeng Zhao, founder of Binance trading platform, the largest in cryptocurrencies, would have lost most of his wealth, falling from $95 billion to $18.8 billion in six months. The cause: the fall in value of cryptocurrencies. In six months, Bitcoin, the most important, is down 55% and Ether, the traditional number two, is down 71%!

Swiss in millions

The Swiss are also affected by this major slump in assets. But their numbers are relatively small, and their losses are proportionate to the value of their businesses. Only half a dozen of them are worth more than a billion francs on the stock exchange.

The largest is Logitech (9.2 billion Swiss francs market value). Year-to-date, it’s down 32.1%. Its largest single shareholder is its chairman and chief executive Bracken Darrell, according to the latest annual report. The value of their 787,324 shares is currently CHF 41.3 million. Since the beginning of the year it has melted by 19.5 million francs. They’re never anything but peanuts compared to what follows.

The individual investor who has lost the most in a Swiss company is a German billionaire, Walter Dröge, a 51.3 percent shareholder of Also Holding, a Lucerne-based digital equipment retailer, according to the website of the Swiss stock exchange SIX. With the stock down 34%, this investor’s capital loss is 673 million francs. It’s certainly boring, but his shares are still worth 1.3 billion francs, a little under a third of the 3.9 billion that make up his fortune, according to Forbes magazine. He is closely followed by Zurich financier Beat Curti, 30% owner of Nidwalden-based SoftwareOne, whose value has lost 39%: 384 million francs have skyrocketed.

Never two without three

He is closely followed by another Zurich native, Werner Weber, who lost 480 million francs after the crash of 32 percent of the shares in the electrical engineering group LEM in Geneva, of which he still holds 51.4 percent, according to SIX. This loss is probably more boring for him: Forbes estimates his fortune at 1.3 billion francs.

Also note the demise of an investor in several Swiss companies based in Israel, Ruth Wertheimer. Its nearly 10% stake in St. Gallen semiconductor group Inficon lost 44%, resulting in a loss of 135 million Swiss francs. Add to that the drop caused by the drop in LEM’s stake, in which it owns 5%, creating another hole of about 40 million.

Two never goes without three, but she still lost something with the 24% slump in Sensirion, a Zurich-based sensor manufacturer in which she holds a 33% stake through a holding company owned by five other partners. The loss of the latter amounts to 167 million, without it being possible to know exactly which part is attributable to Mrs. Wertheimer. But it’s all just money worries! FREEDOM

#Melting #Billions #Courier

Leave a Comment

Your email address will not be published.