Americans' net worth rises for third straight quarter

[Judi Lynn]

Source: Associated Press

Americans' net worth rises for third straight quarter
Friday, March 12, 2010
Stock gains boost Americans' net worth

Americans regained more of their shrunken wealth last quarter, mainly because of gains in stock portfolios. The Federal Reserve reported Thursday that household net worth rose 1.3 percent in the fourth quarter of 2009, to $54.2 trillion. Net worth rose 4.5 percent in the second quarter and 5.5 percent in the third. The value of stocks rose nearly 4 percent in the period, to $7.7 trillion. Higher home prices helped a bit: Real estate holdings edged up 0.2 percent.

Americans' net worth would have to rise 21 percent more to get back to its pre-recession peak of $65.9 trillion.



Read more: http://www.washingtonpost.com/wp-dyn/content/article/2010/03/11/AR2010031104797.html

[Ozymanithrax]

1. I am not sure that increase in Net-worth due to higher stock pricess...

is an effective way of measuring our sense of wellbeing as a nation.

[karynnj]

14. I agree, it is a measure of how the top 30% or so are faring and says little about the

other 70%. Even among that lucky segment, it looks like the numbers on their portfolios are still lower than before the recession. That and the shock of seeing value fall incredibly fast in late 2008, might mean that they do not have anywhere near the confidence in their own wealth they had before the recession. The tangible impact of this is that they may not yet be back to the prolifigate spending of prior years.

For the majority of the economy, the jobs and wages statistics are far more related to their well being.

While this is a sign in the right direction - this is better than if they were declining, only those believing in trickle down economics would think this measures overall well being.

[Art_from_Ark]

2. My net worth rose

from $5 in the bank last quarter, to $10 in the bank this quarter!

[No Elephants]

8. Congrats on doubling your assets!

:toast:

[Cal Carpenter]

36. LOL. And there goes the $10

Well spent on two beers :)

Oh well, at least we still have a sense of humor....

[JDPriestly]

3. And median household income -- from $48,200 end of 2006 to $50,740 in 2009

In 2006

Real median household income in the United States climbed between 2005 and 2006, reaching $48,200, according to a report released today by the U.S. Census Bureau. This is the second consecutive year that income has risen.

http://www.census.gov/Press-Release/www/releases/archives/income_wealth/010583.html

. . . according to USA Today, median household income has never dropped as much (in inflation adjusted dollars) as it did in 2008, and things are expected to be even worse this year.

According to the Census Bureau, median household income in the United States fell to $50,303 in 2008, a drop of 3.6%.

This is the biggest drop seen since the government started keeping records of such things in 1947.

. . . .

http://www.davemanuel.com/2009/09/10/median-household-income-in-the-united-states-falling-off-a-cliff/

And in 2009?

Median household income . . . $50,740
Per capita income . . . $26,688

http://www.stlrcga.org/x1835.xml

[No Elephants]

9. Per capita income is $26+K, yet median hh income is $50+K? Are we counting kids in "capita?"

[melm00se]

13. per capita

is the equivalent of the average.

median HH income is a better gauge as it is not skewed by incomes at the extremes. the median is the line where half the population is above or below the line.

this, in the long run, bodes well.

[karynnj]

15. This is interesting and good news

[golfguru]

28. Sure, all the younger employees have been laid off

who made less wages than what is left. People I talk to are
saying their company has cut staff to the bone, there is no more
left to cut without closing the business.

The silver lining here is that unemployment will stabilize since
there is not much left to cut.

[Steerpike]

4. Ha ha ha

That's due to bankers getting multi million dollar bonus and raises...hey chumps it all evens out in the end!

[dmallind]

5. There's another one who apparently confuses median with average

How many bankers are there getting those massive bonuses and raises?

[Steerpike]

19. oops

You are correct sir! there is a differance...still hard to believe the numbers are not somehow skewed...

How is this figured...the median salaries of employed Americans? Or the Median income of all Americans...

[Demeter]

6. Not If You Balance It Against the National Debt, It Isn't

and that would be what people are expecting places like Iceland and Latvia to do.

[DisgustedInMN]

7. Well whooptie-fucking-dooooo...

... does that mean there's a decent job for me? My income dropped to zero three weeks ago. Damn I feel so much better off!

Happy happy joy joy!

[Roland99]

10. I'm into the triple digits now!!

I'm worth a whopping $282.

And this weekend I'm paying off my two Master Cards!

[jody]

11. "43% have less than $10k for retirement" single black women median wealth $5

http://money.cnn.com/2010/03/09/pf/retirement_confidence/index.htm

http://toledoblade.com/apps/pbcs.dll/article?AID=/20100312/OPINION02/3120321

[OhioChick]

20. That's the first thing that came to mind when reading this article...

The story that came out this week that nearly half have less than 10K saved.

[jody]

21. IMO the $10k figure for half the work force is very important since SS and retirement programs are

facing bankruptcy.

[Iowa]

22. This is what the right wants us to believe, but it's false...

"SS... facing bankruptcy."

SS is not facing bankruptcy. Benefits can continue to be paid as they are currently being paid, even if NOTHING is done, until 2037. In 2037 the trust fund will be spent, and incoming receipts would be sufficient to pay about three fourths of scheduled benefits through 2083 - long after we're all dead. Some relatively minor adjustments are needed, but the system is not "facing bankruptcy" - not even close.

The right despises Social Security. They always have. They are on a mission to convince everyone that the system is on the verge of collapse. If they can undermine faith in the system, they can divide, conquer, and destroy SS once and for all.

The U.S. govt is facing a debt crisis due to wars-about-nothing, Wall-Street bailouts, corporate welfare, and tax cuts for the wealthy. Social Security, however, is well managed and relatively sound. While the SS system would be threatened by the prospect of the U.S. defaulting on its debts, it is no more threatened than savvy investors who continue to purchase treasury securities every single day.

The worst thing we can do as progressives is to spread FUD regarding SS.

[jody]

23. Do you have a credible source supporting your assertion SS is not facing bankruptcy? n/t

[mbperrin]

24. Trustees' report?

http://www.socialsecurity.gov/OACT/TRSUM/

A SUMMARY OF THE 2009 ANNUAL REPORTS
Social Security and Medicare Boards of Trustees

A MESSAGE TO THE PUBLIC:
Each year the Trustees of the Social Security and Medicare trust funds report on the current and projected financial status of the two programs. This message summarizes our 2009 Annual Reports.

The financial condition of the Social Security and Medicare programs remains challenging. Projected long run program costs are not sustainable under current program parameters. Social Security's annual surpluses of tax income over expenditures are expected to fall sharply this year and to stay about constant in 2010 because of the economic recession, and to rise only briefly before declining and turning to cash flow deficits beginning in 2016 that grow as the baby boom generation retires. The deficits will be made up by redeeming trust fund assets until reserves are exhausted in 2037, at which point tax income would be sufficient to pay about three fourths of scheduled benefits through 2083.


Lots more at the link

[jody]

25. That report says reserves will be exhausted in 2037, i.e. unable to pay 1/4 of obligations. n/t

[mbperrin]

31. Yes, that will be 27 years from now, when I am 85 years old.

And that is if we do not change one single thing, period.

So imminent doom, no.

The oldest boomers will be 91 that year. Since the average life span in the US is 78, it doesn't appear there will be much of a problem.

[jody]

33. Don't dismiss those who may be 102 in 2037. n/t

[mbperrin]

37. Yes, all 50,000 or so of them in

http://www.census.gov/population/estimates/nation/intfile2-1.txt

a population of 500 million or so 1/100 of 1% of the population then.

Tell you what - if they're still breathing and being trouble by then, just take 'em out and shoot 'em. You know you want to, anyway, and then all these generational issues and angst surrounding the boomers can finally be resolved.

K?

[jody]

38. Not OK because I must consider my children, grandchildren, & great grandchildren already here and

how they will be treated if SS is unable to meet its obligations after 2037.

You worry about yourself and I along with millions of others will worry about our descendants.

[Iowa]

32. Yes, if NOTHING is done...

...and for someone who believed until a few minutes ago that SS was going bankrupt, I'm surprised your aren't incredibly relieved to hear this. What this means is that according to current projections, NOTHING WOULD NEED TO CHANGE until 2037 - even if no action is taken to fix the actuarial issues! And even in 2037 they would still be able to pay 76% of benefits until 2083 - long after we're all dead. So a $2000 benefit would become a $1520 benefit - but not until 2037. For someone who believed that SS was on the verge of bankruptcy until a few moments ago, I find it odd that you would portray this information as negative and somehow supportive of your earlier claim that SS is on the verge of bankruptcy. If you are genuinely concerned about preserving Social Security, I would expect you to be relieved.

Now... nobody wants benefits to be reduced by 24% in 2037. So what's the best trade-off to prevent it? These are run-of-the-mill actuarial issues. Pension plans must occasionally adjust to deal with such issues as increased lifespan, generational fluctuations, etc. Social Security is no different. Such issues have been dealt with in the past, and will need to be dealt with in the future. The SS trust fund was allowed to balloon to 2 trillion+ due to the size of the baby boom generation. Payroll taxes have been raised in the past. Full-benefit retirement ages have been increased a bit. Now it's time to tweak it again. That goes with the territory. That's how pension plans work.

The point is, SS is not going bankrupt, despite what the right might want you to believe. That doesn't mean we can expect that nothing about SS will change, however. We might expect to see changes involving a combination of the following:

1) An increase in payroll taxes. Right now employees pay 6.2% (employers pay the same). Bump that to 7.2% and the problem is solved. Just that alone would fix it. Again, we'll probably see a combination of things - not just one.

2) A reduction in benefits. An immediate reduction in benefits of 13% - that alone - would solve the actuarial problems. So a retiree getting $1500/month would get only $1305/month. Again, I'm not suggesting that should be done, but it provides you with a rough idea of the magnitude of change required.

3) President Obama suggested a couple weeks ago that removing the cap would solve it (this is my preference).

4) An increase in the full-benefit retirement age has been done in the past, so perhaps we'll see that as a part of any change.

The point is, Social Security is going to be there for all of us, but only if we support it. The worst thing we can do is spread FUD. The facts are on our side. We can beat back the right-wing propaganda - but only if we understand the facts.

[jody]

34. I said in # 21 "facing bankruptcy" . The way congress procrastinates it's not to early for them to

starting looking for solutions.

[Iowa]

26. You can access the information on SSA's web site...

It's called the Trustees Report, but there are lots of Q&A types of info there too.

And you know those Social Security Statements that SS sends out to everyone every year? Yep, it's on there too.

[jody]

29. See #25 which refutes your assertion. I repeat, do you have a credible source? n/t

[Iowa]

35. See post #32. I cover your questions there...

And post #25 does not refute my assertion... not in the least. Post #25 actually displays a considerable lack of understanding on your part - so much so that it has become obvious that you simply do not possess the fundamental knowledge of the SS system that would be necessary to understand what I'm saying. And you do not seem even slightly inclined to learn.

Both mbperrin and I have made a sincere effort to address the right-wing FUD you are spreading about the Social Security system. Unfortunately, we simply cannot penetrate your prejudices and lack of knowledge. I would say that you should be ashamed of yourself for participating in the right's efforts to undermine the public's faith the Social Security system, but I honestly don't believe that you even understand what it is that you're doing. And you're perfectly happy to leave it at that. So I won't waste any more of my time on this.

[No Elephants]

12. The bailout and plans for a giveaway to health insurers probably went a long way toward

making those statistics look good.

[Name removed]

16. Deleted message

Message removed by moderator. Click here to review the message board rules.

[hunter]

17. The room goes silent... heads turn.

:yoiks:

[hunter]

18. Bam!

Cleanup at table 16, please...

[ipaint]

27. Top 10% have 80-90% of stocks.

"Growth in stock portfolios delivered the biggest lift to net worth in the October-to-December period. The value of stocks rose by nearly 4 percent to $7.7 trillion."


Who holds the stock-

In terms of types of financial wealth, the top one percent of households have 38.3% of all privately held stock, 60.6% of financial securities, and 62.4% of business equity. The top 10% have 80% to 90% of stocks, bonds, trust funds, and business equity, and over 75% of non-home real estate. Since financial wealth is what counts as far as the control of income-producing assets, we can say that just 10% of the people own the United States of America.

http://sociology.ucsc.edu/whorulesamerica/power/wealth.html


Hooray for the top 10%. The same folks who never felt the recession are now "recovering".

[jody]

30. Top 1% own over 50% of our financial wealth and control every major multinational corporation.