Welcome to our #88 weekly newsletter.
“For women taking control of their financial future”
-Jana Hlistova
From The Purse
In this week’s newsletter, we focus on a global report published about household inequality and what this means for women’s wealth.
We continue to see that unpaid care work and gender dynamics in the home has a negative impact on women accumulating wealth.
You can review the news in brief so you stay on top of global financial, economic and investing trends.
And don’t forget to listen to The Purse Podcast with Vicky Pryce, Chief Economic Adviser and a board member at the Centre for Economics and Business Research (CEBR). We talk about the effect Brexit and Covid 19 is having on the global and UK economy, what this means for your money, are we headed for a market crash, why UK investment is key and more.
Stay safe everyone & look after yourselves.
I hope you enjoy this week’s newsletter.
Until next week,
Jana
Global report: household inequality (and what this means for women’s wealth)
Intra-house inequality has declined 20%, but global gender inequality persists between couples.
According to new global research, intra-house inequality has declined 20% between 1973-2016, as reported by the BBC.
However the research confirms that gender inequality persists across countries over time, and across rich and poor households. And this is despite more women joining the labour force and earning more money.
The household is a blackbox
It is often assumed that incomes are pooled and equally distributed within a household. But the household is often a place of great inequality.
The report describes the household as a ‘blackbox’ because according to Professor Swaminathan, we are not looking inside.
And the household is essentially made up of the distribution of work and wealth within homes.
Is it equal?
The research says that ‘..even in the Nordic countries, which have the lowest levels of gender inequality in the world, we found the women's share is less than 50% everywhere.’
Wait. But why?
In general terms, the gender pay gap persists.
And women to continue to take up the majority of childcare and household chores.
Globally, women perform 76.2% of total hours of unpaid care work, more than three times as much as men, as per the International Labour Organisation report (2018).
Therefore, women are more likely than men to take career breaks, work part-time or on a temporary basis to look after their young family and manage a household.
Not only do women earn less as a result, they have less time, they accumulate less money, they have less money to invest in assets, which negatively impacts their net worth (over time).
Crucially, a woman's lower income and lower net worth, affects the gender dynamics in the household, which (too) compounds over time. (This, of course, puts a strain on many partner relationships).
Increased earnings and personal wealth not only ensures greater personal agency, it also enables a woman’s negotiating power about how work should be distributed in the home (for example).
Therefore unpaid care work and gender dynamics in the home continues to mute wealth accumulation for women.
The rise of the female breadwinner
In the UK, women out-earn male partners in almost a quarter of households, up from a fifth 16 years ago, as per data from the Office of National Statistics (ONS).
Women earn the same as or more than their male partner in almost three-in-ten households: 27.6% in 2019.
And at the current rate of growth, it will take 62 years before women earn more than men in more than half of households.
According to Becky O’Connor, personal finance specialist at Royal London, ‘..women becoming breadwinners could be the key to some pretty big changes and the undoing of some harmful assumptions.’
And let’s not forget…
…that a massive transfer of wealth to women is taking place right now.
By 2023, a third of all wealth will be in women’s control (this will continue to accelerate over the next ten years).
As women’s wealth continues to grow, so will women’s negotiating power. And ultimately, this will lead to a shift in the gender dynamics.
And a more fair and balanced home (life).
News in Brief
Financial news
US stocks had the best week since July on strong corporate earnings. S&P 500 gains 2% over past five days as company results are weighed against fears of inflation.
FTSE 100 ends on a 20-month high after best week since May. That takes its gains this week to around 2%, the best since the first week of May.
IMF warns of the need to be ‘very, very vigilant’ over rising inflation risks. Gita Gopinath, the IMF’s chief economist, said the strength of the economic recovery meant it was too early to ‘say anything about stagflation’.
European Central Banks’s (ECB) Christine Lagarde says that Europe’s inflation spike is ‘largely transitory’.
Bank of England (BoE) official, Michael Saunders, warns of early interest rate rise. His comments come as households face mounting energy bills and the prospect of higher food prices.
US sales rise unexpectedly: retail sales rose by 0.7% last month, beating expectations of a 0.2% fall, and were 13.9% stronger than a year ago.
UK petrol prices hit 140p for the first time since 2012. The rise follows the recent jump in oil prices (Brent crude hit $85/barrel on Friday for the first time since 2018).
Crypto: bitcoin, ethereum & DeFi
Crypto market cap breaks $2.5tn as bulls predict a ludicrously strong Bitcoin and Ethereum rally.
Bitcoin tops $60,000+ for the first time since May, 2021. (It is currently trading at $61,100+).
Ethereum price pushes towards $4000. (It is currently trading at $3,870+).
SEC approves Bitcoin Futures ETF. This is likely to open up Bitcoin to a wider investor base.
Tether to pay $41m for claiming its stablecoins are fully backed by dollars.
Coinbase announces NFT waitlist, following the lead of Binance and FX. To start, it will offer users the ability to mint, purchase, and showcase their NFTs.
Bitcoin miner Stronghold will list almost 6m shares in in its $100m IPO (on Nasdaq, US). A common stock shares priced between $16 and $18 under the ticker SDIG.
Former Chancellor Phillip Hammond says UK’s treatment of digital assets is a ‘huge risk’ for the finance sector.
The Purse Podcast
We cover the following in our conversation:
Brexit & Covid: the impact on the economy
Rising inflation, slower economic growth
An economic recovery
UK investment is key
Climate change
Female-led startups
And more
Please enjoy! Listen on all podcasting channels including iTunes and Spotify.
Coffee Break? Read This
Female directors wait longer than men for their big break, report reveals
Struggling to remember something? You may have an attention problem
We’d love to hear from you. Get in touch with Jana via the The Purse website or tweet @jointhepurse and @janicka.
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The Purse provides content for informational purposes only, we do not recommend products or services or provide investment advice. Please do your own research or speak to a financial advisor.
Global report: household inequality (and what this means for women's wealth) and listen to our podcast with Vicky Pryce about the global & UK economy