UK, EU, US or India – where should you put your money. Brexit and Trump mean the question is more important than ever.
How about some evidence from the World’s richest man and also China’s richest man – they say things you would not expect!
This week saw India’s GDP growth overtake China’s. I tweeted China’s richest man who said that the UK is best place to invest, regardless of Brexit. (His name is Wang Jianlin) – and he is richer than the owner of Alibaba. He is looking to increase his UK investments.
What of the world’s richest man – Warren Buffett? These are the best quotes from his letters to Shareholders in the last couple of years:
“For 240 years it’s been a terrible mistake to bet against America, and now is no time to start. America’s golden goose of commerce and innovation will continue to lay more and larger eggs. America’s social security promises will be honored and perhaps made more generous. And, yes, America’s kids will live far better than their parents did.
Promises will be honored and perhaps made more generous. And, yes, America’s kids will live far better than their parents did. American GDP per capita is now about $56,000. As I mentioned last year that – in real terms – is a staggering six times the amount in 1930, the year I was born, a leap far beyond the wildest dreams of my parents or their contemporaries. U.S. citizens are not intrinsically more intelligent today, nor do they work harder than did Americans in 1930. Rather, they work far more efficiently and thereby produce far more.
This all-powerful trend is certain to continue: America’s economic magic remains alive and well.
Some commentators bemoan our current 2% per year growth in real GDP – and, yes, we would all like to see a higher rate. But let’s do some simple math using the much-lamented 2% figure. That rate, we will see, delivers astounding gains.
America’s population is growing about .8% per year (.5% from births minus deaths and .3% from net migration). Thus 2% of overall growth produces about 1.2% of per capita growth. That may not sound impressive.
But in a single generation of, say, 25 years, that rate of growth leads to a gain of 34.4% in real GDP per capita.
In turn, that 34.4% gain will produce a staggering $19,000 increase in real GDP per capita for the next generation.
Were that to be distributed equally, the gain would be $76,000 annually for a family of four. Today’s politicians need not shed tears for tomorrow’s children.”
We need not shed a tear for the future generations of America at least. The UK tells a similar story – even allowing for inward migration.
