When the Pandemic Turned 2020 Into the Monopoly of the Ultra‑Rich
As the world shook under Covid‑19 in 2020, the global economy hit its roughest slump since World War War II. Meanwhile, the big‑bucks saw their fortunes skyrocket, turning the decade into a high‑stakes card game where the stakes are billions.
Fast forward to today, and many of these wealth tycoons are chatting with their money managers about surviving the post‑pandemic tax shoals, tightening up their holdings, and snagging the government’s slice of the recovery pie.
The Whispered Plans of the Super‑High‑Net‑Worth
- Philanthropy or Tax‑Heavy: Some are investing in charitable causes to feel good and maybe get tax smiles.
- Trusts and Relocation: Others are moving cash and businesses into trust funds—or hopping planes to tax‑friendly states and countries.
- Sell Before the Tax Avalanche: A few consider offloading big assets before the rate hikes make their portfolios look like the stock market in 2008.
Channeled Wisdom from Money Managers
Morris Pearl, a former BlackRock Managing Director now running the “Patriotic Millionaires” club, told us: “The market blew up in 2020, then steadied around July. Today? It’s bragging about being way higher than last year.” He added that inequality is getting a bigger nosedive.
Rob Weeber, CEO of Swiss wealth firm Tiedemann Constantia, admitted “Everybody’s getting a bill coming. Some clients are selling big pieces of their businesses before taxes climb.”
Why the U.S. Has a Hotspot of Trust Talk
The buzz gets louder after President Biden’s election. With a looming raise on top‑tier taxes, advisers note a spike in trust creation, especially last year’s Q4.
Alvina Lo, chief wealth strategist at Wilmington Trust, said, “Most clients were on a waiting‑and‑seeing mode until November, and boom—trusts were created and funded in a flurry.” She pointed out that trusts let families funnel funds beneath the current $11.7 million tax‑free threshold per person.
Biden’s campaign even proposed bringing the exemption back to 2009 levels—around $3.5 million—when the caps were lower.
Bottom Line
In a post‑pandemic world where the rich keep piling up wealth, the main playbook revolves around trusts, tax‑friendly moves, and a dash of philanthropy. Sounds like a game of Risk, but with a few extra guns—trusts—on the shelf.
‘Extraordinarily agile’
Billionaire Bonanza: How the Rich Made a Pandemic Payday
Ever wondered where the world’s fat cats actually got their extra dough? Forbes says it wasn’t from a secret tax loophole but from a 20 % bump in 2020 fortunes, almost two‑thirds of the global billionaire crew. That’s more money than most of us earn in a decade.
2020’s Money‑Making Moment
- Recovery funds poured in from governments like never before.
- Billionaires’ assets surged, eyes on the prize.
- Average billionaire net worth grew by roughly one fifth—pretty sweet.
Smart‑Money, Not Cowboy‑Money
While the average Sheila may trade a pair of stocks on a phone app, these high‑rollers used a different playbook. Think of it as a carefully choreographed dance:
- They bought short‑term derivatives, betting on market swings.
- When prices dipped, they sold put options—or even risk reversals, a trickier move.
- The payoff? A tidy profit when the economy bounced back.
One big bank’s investment chief called it “agility at its finest”—whatever that means. It basically translates to “the richest folks figured out how to ride the roller coaster.”
Spotlight Flares and the Taxes That Follow
Now, the world’s crown jewels are staring at a grand‑standing crowd of critics. Governments have sky‑high debt, and people are yelling. So the ultra‑rich are feeling the heat, and here’s what they’re doing:
- Wind up trust funds for their kids, moving money out of direct ownership.
- A swing toward tax‑friendly structures to dodge looming scrutiny.
- Aiming to lock in lower valuations while rates stayed at historic lows.
Why Trust Funds Are the New Superpower
An investor strategist surveyed families and found an astounding 75‑80 % cut‑in line for today’s tax puzzle. They’re betting that this pandemic‑era dip gives them a chance to stash assets in trusts and save on future taxes.
- After 7‑8 months, inquiries for this strategy triple.
- Nearly every family on the conversation list said: “We need to capitalize on this moment.”
Bottom Line: Wealth, Winks, and Warnings
The rich are riding both the upside of unprecedented inflows and the downside of increased scrutiny. They’re moving, moving, moving—into trust funds, skipping taxes, and staying ready for whatever fiscal storm comes next. The high‑end playbook is intentional, loud, and built to ride the wave of global upheaval. The message? Even as the world throws rocks, the wealthiest keep turning it into a shiny investment daisy that blooms with money.
The hamptons, or Singapore?
Millionaires on the Move: The Great Tax‑Chaos Migration
When the world’s mega‑rich started waving the “transparent tax” flag, many of them packed their bags. The idea? Find a place where the government is clean, the bureaucracy is friendly, and the tax rates are low enough to make a difference.
Key Players and the “Why” Behind the Trip
- Babak Dastmaltschi, Credit Suisse: “We’re not going to fight transparency. Let’s pick jurisdictions that’re open, respected, and globally recognized. Switzerland, Luxembourg, Singapore—good bets.”
- Henley & Partners in London: “The pandemic turned the spotlight on global relocation. Calls from the U.S. jumped 206 % in 2020. Brazil’s numbers jumped 156 %.”
- Beatriz Sanchez, Julius Baer: “Covid stripped the armor off our national systems. People realized our healthcare and safety nets are shaky. So the next‑gen wealth wants out.”
- Cindy Ostranger, Clarfeld Citizens: “Ultra‑wealthy clients are moving from NYC to their vacation spots—Hamptons, that is—to dodge the worst of the pandemic and keep paying lower taxes.”
- Kristi Hanson, NEPC: “Texas, Florida, and Washington are now the three guys to watch for low‑tax relocation.”
Why the Cool Kids Are Leaving
In emerging markets, the anticipation of public services straining—and maybe sparking civil unrest—has given younger, wealthy families a reason to trade the local sweat for a newer, shinier life abroad.
Fun Facts About the Move
- Switzerland: “We have a tradition of neutrality and confidentiality.”
- Luxembourg: “It’s a tech hub that also loves a good tax break.”
- Singapore: “Low taxes + no corruption = dream combo.”
Taxes Up, Taxes Down
When the money stops flowing into local budgets, folks start swapping. They’re not only eyeing state licenses but also dipping into places with the best tax treatment when they hit new money.
Bottom Line
The world’s elite have already switched sides of the globe to keep their portfolios tax‑friendly and their lifestyles classy. And as governments scramble to keep up with the spotlight on transparency, the millionaires are quietly building new homes in the shadows of the old systems.
Focus on philanthropy
Pandemic‑Pumped Wealth: The Rich Get Richer, While We’re Left Scratching Our Heads
Since the pandemic hit, the richest 1 % in the U.S. have piled up a staggering $1.3 trillion in extra fortune—almost a 50 % bump from the start of 2020. That brings their collective stash to a whopping $4.2 trillion, which is about one‑fifth of the entire American economy in 2020.
Pretty mind‑boggling, right? For context, that ballpark is roughly twice the total wealth that the bottom half of the 330 million Americans own altogether.
“Time to Stop Shouting About Inequality” – Joseph Stiglitz
“We’re wired into this circus of celebrating inequality for over four years,” muses Nobel laureate Joseph Stiglitz, hinting that the Trump era’s tax cuts for the super‑rich were, frankly, a bit off‑track.
Rich Folks Get Warm, Not Just Wealthy
UBS’s American philanthropy boss, Judy Spalthoff, says the pandemic nudged the ultra‑wealthy into a new mode of thinking— “We can’t just keep stacking cash; we need to stop ignoring the rest of the world.” She describes a shift where high‑net‑worth families are suddenly dialing in their inner values and debating social inequality at the boardroom table.
That shift translated into a noticeable spike in charitable activity. UBS’s Optimus Foundation saw 74 % higher donations to causes such as Action Against Hunger, totalling $168 million last year.
Gary Stevenson & the Wealth Tax Wish
Across the pond, Gary Stevenson—a millionaire with a background as a Citibank trader—counters that breaking the “wealth gap” puzzle requires more than just lower income tax rates for the rich.
He argues that many billionaires dip into a cape of lower tax rates on income, whereas ordinary workers face the full tax grind. Stevenson insists we mix in a wealth tax so that the uber‑rich pay in what they truly own, not just what they earn.
Bottom Line: A New Playbook for Rich and Reckoning for All
- We’re surfacing with a staggering $4.2 trillion stash for the wealthiest 1 %.
- Philanthropic enthusiasm has spiked—donations up 74 %.
- Some leaders feel the need for a wealth tax to ensure the riches round up with fairness.
- Everywhere from the U.S. to the U.K., the talk is shifting from “grow our pockets” to “plug the gap.”
While the wealthy pile up more cash, it seems many are finally realizing that wealth, big or small, just isn’t the whole story—especially when it comes to a planet that’s still fighting the pandemic’s wrath.
