UBS report shows the middle class is shrinking worldwide

Average wealth rises, median wealth collapses: the middle-class mirage

The latest UBS global wealth report contains a devastating paradox: average wealth (driven by the ultra-rich) keeps growing, while median wealth — the kind that actually reflects the ordinary citizen — is falling in half a dozen developed countries. Spain, the United States, Germany and the UK top the list of nations where the middle class is evaporating, according to the document.

The explanation emerging from the economic analysis points to an old acquaintance: the Cantillon effect. Central banks' monetary expansion does not water everything equally; new money reaches states, banks and investors first, inflating assets (stocks, gold, real estate) before it touches the real economy. The result is a systematic transfer of wealth from the bottom to the top. As simple as it is brutal.

Housing: the star asset that devours its own tenants

One of the most bitter debates centres on housing. As a basic necessity and an immovable good, it has become the favourite asset of both investors and tax authorities. Available calculations show that while median wealth falls in Spain, the homeownership rate remains high, which glosses over the figures. But the trend is clear: anyone who does not own a home is simply left out of the distribution.

Singapore's alternative — a public housing system that achieves 90% homeownership — is cited as a counterexample proving things can be done better. However, the pessimistic consensus holds that the system is designed so that property never stops rising, condemning new generations to stratospheric rents or forced cohabitation.

The final irony: while large fortunes hit record highs, the middle class is discovering that it is already, statistically, the new poor class. Open question: how long can a society hold up without its backbone?