World's economic blues trouble the rich

Wealthy Monacans fear an economic downturn. Photo / Supplied

Maybe it isn't always better to be rich. Wealthy people these days seem to worry more about the future than those who may be out of work.

Consider the folks in Monaco, nestled snugly in their mansions on the Riviera. More than half of Monacans who have £1 million ($2.13 million) to invest fear the global economy will head downhill in the next five years, according to a survey by Barclays.

These people should worry in the constitutional monarchy where they live to avoid income taxes and then throw away some of the savings in the casino?

In fact, their money worries are shared by rich people around the world, says the survey by the wealth management unit of London-based Barclays.

In Japan, 35 per cent of those with £1 million or more to invest believe the economy will deteriorate in the next five years. In the US, the figure is 25 per cent.

By contrast, American consumers - 9.9 per cent of whom are without jobs - are more optimistic about their economic future than at any time in the past 26 months.

The Conference Board's confidence index rose to 63.3 in May from 57.7 in April. The improved employment outlook was the key to the increase, though the index was still well below a peak of 111.9 in July 2007.

In Monaco, people may be distressed because they pay their bills and value their homes in the euro, which has fallen amid concerns about debts of other countries using that currency. Wealthy Japanese and Americans fret that the euro's disease will hurt banking and trade around the world.

The more you look at the Barclays survey, the odder the results seem. In checking with 2000 investors in 20 countries in February and March, the bank found that those with £10 million to invest were even more negative than those with a mere million.

What's more, 40 per cent of investors in Spain say they expect the global economy to expand, not deteriorate, in the coming five years. Spain is one of the European governments that may have to be bailed out by the European Union and the International Monetary Fund because of its high debt.

Maybe worrywarts would be less stressed-out if they could play the job market as adroitly as investment bankers Achintya Mangla and Aloke Gupte just did.

Last month, Merrill Lynch, the investment firm owned by Bank of America, lured the two away from JPMorgan. Now, JPMorgan has hired them back, Bloomberg News reported this week.

Mangla will be co-head of equity capital and derivatives markets for Asia, excluding Japan and Australia. Gupte will take charge of convertible bond underwriting in the Asia-Pacific area, the position Mangla had held.

Swell jobs, and you would suspect both bankers got substantial pay raises for moving and then not moving. Actually, Mangla and Gupte hadn't even reported to work at Merrill Lynch before JPMorgan hired them back.

In investment banking parlance, they had been on gardening leave. Nice duty.

- BLOOMBERG