**Everyone in Norway is now a millionaire**

[EagleEye]

All Norwegians become crown millionaires, in oil saving landmark

 

By Alister Doyle20 hours ago

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Siv Jensen, leader of Norway's Fremskrittspartiet (Progress party), speaks to party members while …

By Alister Doyle

 

OSLO (Reuters) - Everyone in Norway became a theoretical crown millionaire on Wednesday in a milestone for the world's biggest sovereign wealth fund that has ballooned thanks to high oil and gas prices.

Set up in 1990, the fund owns around 1 percent of the world's stocks, as well as bonds and real estate from London to Boston, making the Nordic nation an exception when others are struggling under a mountain of debts.

A preliminary counter on the website of the central bank, which manages the fund, rose to 5.11 trillion crowns ($828.66 billion), fractionally more than a million times Norway's most recent official population estimate of 5,096,300.

It was the first time it reached the equivalent of a million crowns each, central bank spokesman Thomas Sevang said.

Not that Norwegians will be able to access or spend the money, squirreled away for a rainy day for them and future generations. Norway has resisted the temptation to splurge all the windfall since striking oil in the North Sea in 1969.

Finance Minister Siv Jensen told Reuters the fund, called the Government Pension Fund Global, had helped iron out big, unpredictable swings in oil and gas prices. Norway is the world's number seven oil exporter.

"Many countries have found that temporary large revenues from natural resource exploitation produce relatively short-lived booms that are followed by difficult adjustments," she said in an email.

The fund, equivalent to 183 percent of 2013 gross domestic product, is expected to peak at 220 percent around 2030.

"The fund is a success in the sense that parliament has managed to put aside money for the future. There are many examples of countries that have mot managed that," said Oeystein Doerum, chief economist at DNB Markets.

Norway has sought to avoid the boom and bust cycle by investing the cash abroad, rather than at home. Governments can spend 4 percent of the fund in Norway each year, slightly more than the annual return on investment.

Still, in Norway, oil wealth may have made the state reluctant to make reforms or cut subsidies unthinkable elsewhere. Farm subsidies allow farmers, for instance, to keep dairy cows in heated barns in the Arctic.

It may also have made some Norwegians reluctant to work. "One in five people of working age receives some kind of social insurance instead of working," Doerum said, despite an official unemployment rate of 3.3 percent.

(Reporting by Alister Doyle; Editing by Alison Williams)

[vietnam1969]

Very interesting article there

[easyrider]

Every Single Person in Norway Became a Millionaire Last Week. Here's How.



The news: On Wednesday, everyone in Norway became a theoretical millionaire as the country’s sovereign wealth fund — the largest in the world — soared to 5.11 trillion crowns ($828.66 billion) due to high global oil and gas prices.

Now not only is Norway the second-happiest place on Earth (according to the UN’s World Happiness Report 2013), but they’re also amongst the world's most financially secure citizens.

The background: In 1969, Norway struck oil in the North Sea. Today, it is the world's seventh biggest oil exporter, Europe's largest oil producer and the world's second largest natural gas exporter. The fund was set up in 1990 and now is the largest of its kind in the world, followed by the United Arab Emirates’ at $800 billion, Kuwait at $400 billion, and Russia and Kazakhstan at about $180 billion each. Norway’s fund is invested in the developing economies of Brazil, Russia, India and China, as well as real estate throughout the world.

Norway’s fund, which collects taxes from oil profits and re-invests the money, mostly in stocks, is worth about $177,000 per Norwegian. The fund owns 1% of the globe’s stocks and a vast empire of real estate, but the government is only allowed to use 4% of it a year. With Norway's liberal government, oil profits — including from state-run Statoil — are taxed at 78%, compared to the United State's effectively taxing companies like ExxonMobil at 42% and Chevron at 43.4% in 2012.

The money doesn’t go directly to the nearly 5 million Norwegian citizens, but is instead funneled into a savings for a rainy day.

Now that's smart investing. With the stipulation that the government is only allowed to touch 4% of it, the fund has been maturing steadily since it was created in 1990 to be used on a rainy day. When that rainy day does roll around, there will likely be a huge payout to citizens, whether it's in the form of investment in a critical need or a bailout.

Norway’s fund has some detractors, who argue that its investment strategy is risky and oil-dependency is dangerous with the growing proliferation of alternative energy solutions. But its success only proves that it's smart use of money in this volatile economic global environment. (And one can only imagine that our spend-happy U.S. politicians would have dunked into that account years ago.) With the burgeoning natural gas market in U.S., we should be thinking about how, like Norway, we can — by taxing and regulating — create future wealth for this country, not just debt.

http://www.policymic.com/articles/78751/every-single-person-in-norway-became-a-millionaire-last-week-here-s-how

[umbertino]

Interesting. Thanks for sharing.

[EagleEye]

Sorry Easy I posted this already...will merge topics !!

[RodandStaff]

Sorry Easy I posted this already...will merge topics !!

Does that make em twice as happy???     Gee... My mother was full blooded Norwegian... I wonder if that counts for any kinda piece of the pie???    

[willy1der]

Does that make em twice as happy??? Gee... My mother was full blooded Norwegian... I wonder if that counts for any kinda piece of the pie???

If it works out for you Rod remember me your brother from another mother Rod!

[EagleEye]

don't ask me Rod my late father was full-blood Native American...I have yet to get a Casino check     

[umbertino]

I checked Oslo  in 1983.... I have a good friend  there.... City was not bad but I'd rather move South ( Europe, America). My friend himself used to say his fellow country men and women are kinda cold generally.