1-888-528-1216

Online Profile

Profiles allow you to post comments and manage your email preferences.

Make sure to accept cookies from www.aier.org to login



 Make a Donation
 Become a Member
Renew Your Membership

AIER Bookstore

College Destinations Index
Message Digest Algorithm 5 is a one way hashing algorithm. This site indexes md5 hashes and allows you to look up potential plain text versions of an md5 hash, a md5 hash crack.
Households' Net Worth Shrinks PDF Print E-mail
Written by Kerry Lynch   
Monday, 30 June 2008 04:40

The impact of falling prices in the housing market and the stock market is starting to show up in the national data on households’ net worth.  According to new data from the Federal Reserve, the total net worth of all U.S. households (their assets minus their liabilities) was $56 trillion at the end of the first quarter. This is $2.2 trillion less than six months ago (when net worth reached a record high).

Declining stock prices account for the bulk of the decrease. But the estimated value of real estate owned by households also experienced a rare decline. In fact, the half-trillion-dollar decline in the first quarter of 2008 was the largest, in percentage terms, in the 55 years since the Fed began tracking it. 

The chart below shows the year-over-year percent change in the household sector’s net worth.  The recent decrease, while rare, is relatively small compared with the exceptionally large drop recorded in the early 2000’s, after the stock market bubble burst. 

Household Net Worth

The burst of that bubble wiped out $5.5 trillion of net worth. But the lost ground was soon regained—due to booming home prices.  It remains to be seen how long the latest downturn in net worth will last, and what combination of asset appreciation (and perhaps slower growth in debts and other household liabilities) might drive it.

Bookmark this article:

Deli.cio.us    Digg    reddit    Facebook    StumbleUpon    Newsvine
< Prev   Next >
 

Other articles by Kerry Lynch:

Comments (2)
Household networth
2 Friday, 15 August 2008 22:23
Judy Landeros
why would you write a story like this? it is clear that inflated housing values increased networth and the current mortgage crises is taking the networth back down.... in the current 'climate' this is a NO brainer - households are losing - many people owe more on their mortgage than they could sell the house for...
Net worth inflation adjusted?
1 Friday, 04 July 2008 17:50
Kirk Harwood
Should the percent change numbers be adjusted for inflation or have they? For instance, a home purchased for $100,000 in Jan 2007 would cost $103,040 in Jan 2008 (according to the cost of living calculator) if the market stayed the same. That could look like a 3.04% increase in Net Worth. The fact that the Net Worth change was negative makes this gap larger, if these values didn't account for inflation. It would also, lessen the year over year increase, particularly in the 1970's when there was "stagflation."

Add your comment

Your name:
Subject:
Comment:
  The word for verification. Lowercase letters only with no spaces.
Word verification:
yvComment v.1.18.3