The fortunes of America’s richest people got slashed by $78 billion following Federal Reserve Chair Jerome Powell’s speech.
During his speech, which was eight minutes long, Powell pointed out that the US central bank will keep raising interest rates and probably leave them elevated for a while to reduce inflation.
Powell, who was speaking at the Kansas City Fed’s annual policy forum in Jackson Hole, was seen pushing back on a recent rally in US stocks that was triggered by rumours that policymakers would soon reverse course from their aggressive monetary tightening.
After an unprecedented run-up during the Covid-19 pandemic when interest rates were pinned near zero, Powell’s speech served as a reminder that valuations of giant technology companies remain high by historical standards.
Following Powell’s speech, the S&P 500 tumbled 3.4 per cent and the tech-heavy Nasdaq 100 plunged more than 4 per cent.
Not only this, billionaires such as Jeff Bezos, Elon Musk, Bill Gates, Warren Buffett and Bill Gates lost $6.8 billion, $5.5 billion, $2.7 billion and $2.2 billion respectively.
In the steepest six-month drop ever for the wealthiest people on the planet, the world’s 500 richest people lost $1.4 trillion in the first half of 2022.
Since November 2020, US stocks in July posted their strongest monthly advance leading investors to wager that the worst of the market rout was over.
(With inputs from agencies)
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