"The appreciation of financial assets helps personal wealth grow," said Yin. "The American people are bold consumers, which helps boost economic development there."

Fattening the middle

"Increasing property income will enable more people to enter the middle income group," said Guo Shuqing, Chairman of the China Construction Bank. "This coincides with the new requirement stated in the CPC report about increasing the number of middle income people."

Figures from the National Bureau of Statistics show that per-capita property income was 240 yuan ($32.9) in 2006, an increase of 26.5 percent over 2005. This segment showed the largest growth when measuring people's income components.

Real estate prices have soared in the past two years, propping up the property assets of many citizens. Yet income did not spread equally and most has flowed to the higher and upper middle income groups. A significant example of this is that the wealth of those on this year's Hurun China Rich List mostly came from property, not operational income.

Li Qingyun, an economics professor with Peking University, said the proportion of middle income people is too small-about 15 to 20 percent. But the government's proposal stated clearly that property income should be shared by all people and was not just for the rich. As a result, the proposal will attempt to narrow the gap between the rich and the poor.

Li also noted that the key to increasing the proportion of middle income people is to lift the income of the lowest income groups so as to achieve the goal of a well-off society.

Multifaceted capital market

Ba Shusong, a researcher with the Development Research Center of the State Council, said that population structure and economic development signal that China is entering a golden age for wealth management.

Ba said that judging by the population structure in the next 10 years, the proportion of the employed population-mostly born in the 1950s, '60s and '70s-will be at its highest point in history. But by 2018, China will possibly witness a demographic change and enter into an aged society period. This means that current working people have a greater demand for assets and this needs the strong support of a multifaceted capital market.

At present, banks take the largest share of the wealth management market. Statistics from the central bank show that in 2006, bank deposits were the main choice for wealth management for citizens, accounting for 72.71 percent.

The booming stock market has lured many citizens to pull money out of banks and put it into securities and funds. Central bank statistics show that in October 2006, bank deposits dropped for the first time since June 2001, down by 7.6 billion yuan (nearly $1 billion). In August this year, citizens' deposits decreased 41.8 billion yuan ($5.6 billion). This is quite a change from the same time last year, when the amount deposited increased 119.7 billion yuan ($16.1 billion).

Li warned of property bubbles in the domestic market. "The government must create more ways to increase property income," Li argued. For instance, if most of the people invest their money in the stock market, the low income group will be hit hardest if the bubble bursts.

Jiang Jianqing, Chairman of Industrial and Commercial Bank of China, contended that the investment mode is too narrow. "People mostly invest in stock markets, funds and some live on rent income." Jiang said, with the financial development and innovation, more investment channels will be created such as the qualified domestic institutional investor scheme, which allows mainland citizens to invest in overseas markets. Jiang also expects more financial derivative innovations.

Jiang believes the government will create conditions to improve the ability of citizens to manage their wealth, so that more ordinary citizens will become acquainted with the financial market.