Datastream
Equity Purchases by the Bank of Japan Reach a New Milestone
The Briefing
- Domestic equities held by the Bank of Japan (BoJ) reached $434 billion in November 2020, the highest value ever recorded on its balance sheet
- The BoJ began buying equity ETFs (exchange-traded funds) in 2010 to help stabilize its economy
- The BoJ has now surpassed the country’s Government Pension Investment Fund as the largest owner of Japanese stocks
Equity Purchases by the Bank of Japan Reach a New Milestone
The Bank of Japan (BoJ) increased its equity holdings to $434 billion in November 2020, surpassing Japan’s Government Pension Investment Fund to become the country’s largest holder of domestic stocks.
This milestone will likely capture the attention of global policymakers, as the BoJ is the only central bank to purchase equities—a practice it first began in 2010. These purchases were intended to stabilize the Japanese economy after the 2008 financial crisis, but have carried on ever since.
Why Does the Bank of Japan Purchase Equities?
For decades, Japan has experienced a stubbornly low rate of economic growth relative to its peers. Despite the BoJ’s best efforts to boost growth, this trend has continued after the events of 2008.
| Year | Japan (% GDP growth) | South Korea (% GDP growth) | U.S. (% GDP growth) |
|---|---|---|---|
| 2010 | 4.2% | 6.8% | 2.6% |
| 2011 | -0.1% | 3.7% | 1.6% |
| 2012 | 1.5% | 2.4% | 2.3% |
| 2013 | 2.0% | 3.2% | 1.8% |
| 2014 | 0.4% | 3.2% | 2.5% |
| 2015 | 1.2% | 2.8% | 2.9% |
| 2016 | 0.5% | 2.9% | 1.6% |
| 2017 | 2.2% | 3.2% | 2.4% |
| 2018 | 0.3% | 2.9% | 2.9% |
| 2019 | 0.6% | 2.0% | 2.2% |
| Average | 1.28% 🇯🇵 | 3.31% 🇰🇷 | 2.28% 🇺🇸 |
Source: World Bank
No stranger to unconventional policies, the BoJ believes its equity purchases will add a sense of security to the stock market, and as a result, encourage greater levels of investment. Since these purchases began, the Nikkei 225, an index tracking 225 large Japanese corporations, has generated a total return of roughly 160%.
A Drop in the Pond
While $434 billion in equities is by no means a small amount, it pales in comparison to the BoJ’s total assets of $6.7 trillion. This includes $5.1 trillion in Japanese government debt, and $59.4 billion in domestic corporate bonds.
These figures fall in line with other central banks including the U.S. Fed, which currently has $7.4 trillion in assets on its balance sheet. Whether the Fed will also begin purchasing equities, however, remains to be seen.
Where does this data come from?
Source: NLI Research Institute, 2020
Notes: Data as of Nov. 30, 2020.
Figures based on a conversion rate of 1 JPY = 0.0096 USD.
Datastream
Top 20 Countries With the Most Ultra-Wealthy Individuals
Developing countries are creating wealth like never before, but the majority of the world’s ultra-wealthy people still live in the United States.
The Briefing
- According to Credit Suisse, there are now 218,200 people globally with assets over $50 million.
- The majority (53%) of the world’s ultra-wealthy people live in the U.S.
Top 20 Countries With the Most Ultra-Wealthy Individuals
New data from the Credit Suisse Global Wealth Report shows that there was an “explosion of wealth” last year.
The global population of ultra-high net worth individuals (UHNWIs) grew by 46,000 to a record of 218,200. The report notes that UHNWIs benefited from a surge in the value of financial assets last year.
These increases are more than double the increases recorded in any other year this century. – Global Wealth Report 2022
The majority of ultra-wealthy individuals already reside in the United States, but 2021 saw a staggering increase of 30,470 people bring added to this exclusive ultra-wealthy category in the country.
| Country/region | Net Worth of $50–$100M | Net Worth of $100M–$500M | Net Worth of $500M+ |
|---|---|---|---|
| 🇺🇸 United States | 103,669 | 35,740 | 1,726 |
| 🇨🇳 China | 20,013 | 11,411 | 1,282 |
| 🇩🇪 Germany | 6,052 | 3,354 | 318 |
| 🇨🇦 Canada | 3,472 | 1,912 | 123 |
| 🇮🇳 India | 3,024 | 1,750 | 210 |
| 🇯🇵 Japan | 3,373 | 1,411 | 88 |
| 🇫🇷 France | 3,237 | 1,314 | 85 |
| 🇦🇺 Australia | 2,947 | 1,576 | 109 |
| 🇬🇧 United Kingdom | 2,787 | 1,278 | 110 |
| 🇮🇹 Italy | 2,574 | 1,253 | 103 |
| 🇰🇷 South Korea | 2,450 | 1,319 | 117 |
| 🇷🇺 Russia | 2,134 | 1,488 | 253 |
| 🇨🇭 Switzerland | 2,115 | 987 | 92 |
| 🇭🇰 Hong Kong SAR | 1,790 | 1,139 | 127 |
| 🇸🇪 Sweden | 1,866 | 1,019 | 76 |
| 🇹🇼 Taiwan | 1,874 | 912 | 93 |
| 🇪🇸 Spain | 1,509 | 666 | 51 |
| 🇧🇷 Brazil | 1,238 | 749 | 95 |
| 🇸🇬 Singapore | 974 | 570 | 73 |
| 🇳🇱 Netherlands | 1,100 | 471 | 28 |
China and India will likely see their ultra-wealthy populations increase dramatically, but still have a long way to go before catching up to the United States.
The biggest increases, aside from the U.S., were China (5,200), Germany (1,750), Canada (1,610), and Australia (1,350).
Decreases in UHNWI populations were more rare, but did occur in a few cases. United Kingdom (-1,130), Turkey (-330), and Hong Kong SAR (-130) saw the biggest drops.
Where does this data come from?
Source: Credit Suisse Global Wealth Databook 2022
Data note: All amounts in USD
Datastream
Ranked: The Top Cyberattacks Against Businesses
Recent research provides insight into the top cyberattacks that businesses faced in 2021. See the results in this infographic.
Ranked: The Top Cyberattacks Against Businesses
Cyberattacks hit a record high in 2021, continuing the momentum that had developed during the COVID-19 pandemic. One reason for this increase is the shift to remote work, which has opened up new vulnerabilities. Home networks are typically less secure, and the rapid rise in the use of online services means security is falling behind.
In this graphic sponsored by Global X ETFs, we’ve visualized survey results showing the 10 most successful types of cyberattacks in 2021.
The Results
These results are from a 2021 whitepaper by Osterman Research, a market research firm focused on cybersecurity. They surveyed 130 cybersecurity professionals from mid and large-sized organizations to see which types of attacks were the most prominent.
| Type of Attack | Percentage of respondents (%) |
|---|---|
| Business email attack was successful in tricking a lower-level employee | 53% |
| Phishing message resulted in a malware infection | 49% |
| Phishing message resulted in an account being compromised | 47% |
| Domain name was spoofed to perpetrate phishing campaigns | 38% |
| Ransomware was detected before it could be activated | 34% |
| Business email attack was successful in tricking a senior executive | 28% |
| Domain name impersonation resulted in a third-party being compromised | 16% |
| Phishing message resulted in a ransomware infection | 14% |
| A ransomware attack was successfully launched | 10% |
| A ransomware attack rendered internal IT systems non-operational | 10% |
Source: Osterman Research (2021)
The report notes that these figures may be understated because organizations are likely to downplay their security incidents. Organizations may also lack the capability to detect all types of cyberattacks.
The Impact of Phishing Attacks
Phishing refers to an attack where the perpetrator pretends to be a trusted entity. These attacks can be carried out over email, text message (SMS), and even social media apps. The goal is often to trick the victim into opening a malicious link.
According to the whitepaper, opening malicious links can result in credential theft or ransomware infections. Credential theft is when attackers gain access to internal systems. This is incredibly dangerous, as it allows attackers to commit fraud, impersonate company officials, and steal data.
A powerful tool for preventing credential theft is multi-factor authentication (MFA). This method requires users to provide multiple verification factors to access a resource (instead of a single password).
The Threat of Ransomware
Ransomware is a type of cyberattack that involves blackmail, often for financial gain. For ransomware to be successfully planted, attackers must first gain access to a company’s networks.
Access can be gained through phishing, as discussed above, or alternate means such as compromised software updates. One such attack impacted over 57,000 Asus laptop owners in Russia after hackers created a malicious update tool on an official Asus server.
Cybercriminals have become increasingly ruthless in how ransomware attacks are executed.
– Osterman Research
Researchers have warned that ransomware attacks are becoming more dangerous and sophisticated. In addition to locking organizations out from core systems, hackers are also stealing data to increase their leverage. If a ransom is not paid, the stolen data may be published or even sold to the highest bidder.
Under Siege
The rising frequency and sophistication of cybercriminal activity is a major threat to the world.
According to the World Economic Forum’s 2022 Global Risks Report, ransomware attacks have increased by 435% since 2020. Furthermore, there is an estimated shortage of 3 million cybersecurity professionals worldwide.
To catch up, businesses and governments are expected to increase their spending on cybersecurity over the next several years.
The Global X Cybersecurity ETF is a passively managed solution that can be used to gain exposure to the rising adoption of cybersecurity technologies. Click the link to learn more.
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