Growth in millionaire club

Dear Mr. Tan
The Straits Times front page has an article that showed Singapore to have the largest increase in millionaire households last year. I am somewhat disturbed by this article. Was it written to give an impression that our economic progress is the best in the world? I do not see any improvement in my circumstances and for my friends around me. Was this to prepare for the general election?

My reply
I tried to understand how the statistics was compiled and how it should be interpreted.

It showed the number of households that have an assets more than 1 million dollars (USD). This could be due to the sharp increase in property price last year, which is good for owners of multiple properties, but make no difference to those who own only one property for own occupation. Furthermore, I think that the study measures the value of assets and do not take away the liability (i.e. loans to purchase property).

The growth rate of millionaires was 35% in Singapore, but for China and Indonesia, the growth was 31% and 21% respectively. The report does not measure that proportion of the population that can be classifed as millionaires - but the growth in the numbers of these rich households during 2008.

In one respect, it probaly reflects the widening disparity in income in these countries. For each person to be rich, there must be 100 people that has to be relatively poorer.

The report does convey the impression that the economy is doing well, when in reality, more people are suffering from the high cost of living - driven by high property and asset prices.