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1 Shocking Chart Proves America Is Losing Power to Asia

By John Maxfield – Feb 23, 2014 at 12:25PM

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A recent report predicts that Asia will soon become the world's richest region.

The United States' greatest fear may soon be upon it. According to a recent report by The Boston Consulting Group, Asia will become the world's wealthiest region in less than five years.

The authors of the report, which surveys global private financial wealth, predict that the Asia-Pacific region (excluding Japan) will have stockpiled a total of $48.1 trillion in private wealth by 2017. By comparison, North America's accumulated grubstake is expected to grow to only $48.0 trillion.

As you can see in the chart above, this is a considerable change from the present. In 2012, the most recent year included in the survey, North America had an estimated $43.3 trillion compared to Asia's $28 trillion.

According to the authors (emphasis added):

The growth of private wealth varied considerably by region in 2012, as in previous years, once again highlighting the differences in how the year's economic forces affected the traditional, mature economies of the "old world" and the rapidly developing economies of the "new world."

Wealth increased measurably in the old-world regions of North America, Western Europe, and Japan, while double-digit growth characterized the new-world regions of Asia-Pacific (excluding Japan), Eastern Europe, and Latin America.

The significance of this passing of the torch will be felt particularly hard among financial companies including Bank of America (BAC -1.29%), Morgan Stanley (MS -0.97%), and JPMorgan Chase (JPM -0.79%), the nation's three largest wealth managers.

For obvious reasons, it will be critical that these three companies make inroads in emerging markets, and Asia in particular. As the report highlights, "Winning globally in wealth management will not be possible without a leading presence in Asia-Pacific and other emerging markets."

How will they do this? That remains to be seen, though JPMorgan has recently found itself embroiled in controversy over allegedly trying to curry business through the hiring of relatives of high-ranking government employees in China.

Most important for you, the investor, is simply watching how these trends develop and trying to ascertain which of these top wealth managers are navigating this changing world the best.

John Maxfield owns shares of Bank of America. The Motley Fool recommends Bank of America. The Motley Fool owns shares of Bank of America and JPMorgan Chase. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

Stocks Mentioned

Bank of America Stock Quote
Bank of America
BAC
$36.08 (-1.29%) $0.47
JPMorgan Chase & Stock Quote
JPMorgan Chase &
JPM
$135.16 (-0.79%) $-1.08
Morgan Stanley Stock Quote
Morgan Stanley
MS
$92.10 (-0.97%) $0.90

*Average returns of all recommendations since inception. Cost basis and return based on previous market day close.

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