I fared pretty well with my portfolio during the recession. Instead of being fearful and pulling my money out of the market, I took Warren Buffett’s advice and bought more. I bought shares in my IRA when the market was down (vs. dollar averaging throughout the year). I also purchased some US Steel stocks when they were valued at $39 and sold them when they were valued at $63.
Still, my earning potential or loss during the recession was chump change compared to the earning potential or loss of a billionaire. And since many personal finance gurus like to listen to what billionaires have to say when it comes to the stock market (after all, they are doing something right), I thought it would be interesting to see where the world’s top billionaires have landed.
All numbers below are based off of the annual World Billionaire list provided by Forbes.
Bill Gates (Microsoft)
- 2007 Net worth: $56 billion
- 2010 Net worth: $53 billion
- Change: -$3 billion
Warren Buffett (Major Investor)
- 2007 Net worth: $52 billion
- 2010 Net worth: $47 billion
- Change: -$5 billion
Carlos Slim Helu (Mexican Telecom)
- 2007 Net worth: $49 billion
- 2010 Net worth: $53.5 billion
- Change: +$4.5 billion
Ingvar Kamprad (Founder of Ikea)
- 2007 Net worth: $33 billion
- Â 2010 Net worth: $23 billion
- Change: -$10 billion
Lakshmi Mittal (Arcelor Mittal)
- 2007 Net worth: $32 billion
- 2010 Net worth: $28.7 billion
- Change: -$3.3 billion
Are you surprised by the results? I was…at least at first. It appears that Carlos Slim Helu is the only billionaire on this list that came out on top from the recession.
However, after looking into this some more, I found that many of these billionaires had huge losses during the crash of the stock market, and so actually they have bounced back quite well.
For example, in November of 2009, Lakshmi Mittal was only worth $19.3 billion (a loss of $12.7 billion from the crash), and less than one year later he was worth $28.7 billion. That is a $9.4 billion bounce-back!
Here are a few more examples: Warren Buffet lost $16.5 billion during the market crash, and Bill Gates lost $12.3 billion.
Has your portfolio bounced back? Did you come out ahead of where you were before the recession, or has your 401(k) not recovered?
Other Recession Articles You May Enjoy
Sir
First: The capital is a coward
II: loss of close to no gain remote
Third: Pay attention to your opponent or betray
IV: What birds flew up must come down
V: Not all that glitters is gold
I love the post. Warren Buffett is definitely one of my heroes when it comes to investing.
Unfortunately, my wife and I are still paying off some debts, so we are not investing very heavily at the moment.
I did recently start contributing to my company 401(k) since they are starting to match the amount put in. Hopefully I will be able to do more soon!
Thank you Derek!
Keep plugging away at those debts! We just became non-mortgage debt-free this past year, and now our emergency fund is almost up to full capacity. Hurrah! 2011 looks like a good year for us to invest.
In line with the fact that emerging markets did better than developed markets!
Fascinating article. Impressive bouncebacks. It’s mind boggling that these titans lose more than most people will see in their lifetimes, many times over.
Very true. I was surprised to see this as well, and even more surprised that no one else has written about the comparisons pre and post recession (with everyone’s fascination with these people).
Thanks for your comment!
Ours bounced back, probably the same in % terms, but no where near that in $$ terms (unfortunately).
Ah yes…if only it was the same in money terms as well:).
We bounced out at 13000 and bounced back in at 7200. We cleared 14% the last two years.
Of course if you take out the 1% we made on half the money the stocks alone made more like 22%. Nothing like Ford at 2!
Trust your gut- if it looks like a bubble- it probably is….
That’s interesting and proves how well some of them manage to do seeing how well they came back from such a crash…. Still billions lost, ouch!