“The rich gets richer and the poor gets poorer” remains no longer an aphorism in this 21st century. According to a report published on Tuesday, 14th October 2015, over 50% of the world’s wealth is now possessed by only 10% of the people. Among the G7 group of countries, UK stands as the only country to reflect this critical inequality of wealth. The richest 10% of the country’s population owns 54.1% wealth, which increased by 2.6% in the last 14 years, according to the annual Credit Suisse global wealth report.
Whereas a person needs $3,650 to be among the wealthiest half of world citizen, $77,000 is now required to be enlisted as the top 10% and $798,000 to be the top 1% of the wealthiest people. This inequality is clearly making the contrast between the rich and the poor sharper than ever before. The low and middle-income households are being affected the most since their household bills are increasing instead of incomes and wages. Circumstances are so severe with these families that they are having to struggle each day to provide education to their children and medicines to the elders.
Because of this inequality, very few families have been able to borrow huge sums of money to buy a home which is made more difficult with large mortgages, rising credit cards and other borrowings. The household debt thus reached its record level in 2014 at 170% of national income as some people borrowed more to try to buy a home. The reasons for this inequality in wealth lie in rising property and share prices and also the pound’s increase in value against the dollar. If this continues, encountering a recession in future will only be a matter of time as such high wealth-income ratio like this resulted in Great Depression in the past.
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