The rapid pace of the spread of the coronavirus pandemic all across the world and the severity of the disease caused by it – Covid-19, has forced many countries to go on lockdowns. That has resulted in millions of job losses and trillions of dollars being wiped off the global financial markets.
However the virus crisis has not resulted in losses for everyone.
The wealth of the richest man in the world Jeff Bezos, increased by $5.5 billion compared to his net worth at the beginning of the year. On Thursday alone, there was an increase of $3.9 billion in Bezos’ paper fortune, which is mostly held in Amazon shares, and the paper wealth that he now owns is at $120 billion. That money is enough to purchase about 188,000 standard gold bars even at the current very high prices for the golden metal.
This week, stock markets in the United States recorded the best three day performance at a stretch since 1933 which benefitted the 56 year old Bezos. The rally at the stock market helped Amazon to recover all of the lost value in the entire month so far and is trading trade at about $1,920. Even with this rise, the stock price of the company was slightly lower than the peak reached by the stock in February at $2,170 a share. About 12 per cent of the total shares of Amazon is owned by Bezos.
In February, Bezos had sold a big chunk of his Amazon shares which helped to save larger losses for the entrepreneur. The global markets were still going strong in February when the global scale of the economic impact of the coronavirus pandemic was still not acknowledged. Soon after, there was a collapse in the hlobal stock markets over worries of the economic fall out of the pandemic.
In the first week of February, just before the stock price peaked, Bezos sold $3.4 billion worth of Amazon shares, shows regulatory filings.
There is no evidence to suggest that the sell off by Bezos was done in an improper manner or that he was privy to non-public information about the impending impact of the coronavirus pandemic. And yet his timing of selling was almost perfect. According to analysis by the Wall Street Journal, the shares that were sold by Bezos was about 3 per cent of his total holding and were much greater than what he had made in previous months. Also, the total volume of stocks that he sold was equal to what he had sold in the previous 12 months.
Larry Fink, the chief executive of fund manager BlackRock, was among the other US executives who have either been lucky or smart in selling large chunks of their shareholdings in February. Others include Lance Uggla, CEO of data firm IHS Markit.
In the five weeks before the start of the stock market rout, US executives sold about $9.2 billion in shares of the companies in total.
(Adapted from TheGuardian.com)