Elon Musk, once worth $340 billion, has been ousted by Bernard Arnault from his position as the world’s richest person.
Musk, 51, has seen his fortune fall by more than $100 billion since January to $168.5 billion, according to the Bloomberg Billionaires Index. At 10:20 a.m. Tuesday in New York, that sum was less than the $172.9 billion net worth of Arnault, 73, whose wealth derives much of it from his ownership of 48% of fashion giant LVMH.
Musk’s drop from the top of the ranking, the first time it has happened since he took second place in September 2021, caps off a tumultuous year for the frenetic billionaire. He shocked the world in April with his $44 billion offer to take Twitter private, in a brazen display of how the richest people can make use of his vast fortunes.
But that deal coincided with the time the Federal Reserve and other central banks were embarking on their most aggressive round of tightening in a generation, slashing valuations at highly-valued companies like Musk’s Tesla Inc. Shares of the electric carmaker are down more than 50% this year.
Musk tried for months to get out of the Twitter deal, but failed. He sold more than $15 billion worth of Tesla stock, about $8.5 billion in April, then another $6.9 billion in August, to raise enough cash to finance the purchase.
After the Twitter acquisition was finalized in October, the Bloomberg Wealth Index removed $10 billion from his fortune, reflecting that shares of similar companies have plummeted since he made the offer.
Musk has been committed to changing the social media platform, but faces several challenges, some of which he caused himself. He criticized Apple Inc. and threatened to remove Twitter from its App Store at a time when other companies were already pulling their advertising from the site.
Meanwhile, Twitter is poised to face annual interest costs that exceed a measure of its earnings for all of 2021. Musk’s bankers are considering giving him new margin loans backed by Tesla stock to replace some of the high-interest debt he’s been carrying. accumulated with Twitter, Bloomberg News reported.
Arnault, the world’s new richest person, is drama-free compared to Musk.
Arnault has long been a powerhouse near the top of the wealth rankings, but his fortune never grew at the exponential rate seen by that of America’s tech billionaires. Now his empire stands as Mark Zuckerberg, Jeff Bezos , and Larry Page and Sergey Brin of Alphabet Inc. experience a decline in their wealth due to rising interest rates.
Paris-based LVMH Moet Hennessy Louis Vuitton’s designer clothing, fine wines and retail business have benefited from pent-up demand that sparked when covid-related shopping and travel restrictions were lifted in most of the countries. Arnault’s brands cater to the wealthy, ranging from Christian Dior and Fendi to jewelers Bulgari and Tiffany & Co. and champagne maker Moet & Chandon.