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Here are the charts:
According to the Fed, U.S. households' net worth rose $1.63 trillion in the first quarter of this reaching, reaching a new, all-time high of $84.9 trillion. Most of the gains have been in financial assets and savings accounts.
After adjusting for inflation, household net worth also reached a new, all-time high, easily eclipsing the last pre-recession high.
After adjusting for inflation and for population growth, real per capita net worth reached a new, all-time high of over $261K. That's 3.3 times as much as it was 50 years ago!
Importantly, the latest surge in wealth was not driven nor sustained by any debt "bubble." As the chart above shows, household leverage has declined significantly since 2008, all the while net worth rose to new all-time highs. Household leverage today is about the same as it was back in 1990.
Even if all this staggering amount of wealth were held by just a handful of people, it would still be the case that we all benefit from it. This wealth is the ultimate source of all jobs and our living standards. Because our economy can produce so much, so efficiently, the fruits of modern life (e.g., iPhones, air travel, clean water, abundant food) are available to virtually everyone.
I reflected on this while visiting some centuries-old castles and estates today, where it took an army of servants to provide a standard of living for the wealthiest of landowners that would be considered below-poverty-level today. No electric light bulbs. No refrigerators. No HVAC. No TV. You get the picture.
The daily life of a billionaire today is not all that much different from that of a median-income wage earner. Both have ready access to great food, a clean abode, cheap travel, cheap entertainment, great health care, and instant communications with just about anyone, anywhere in the world.
5 comments:
Far better a billionaire keep his money than the federal government confiscate it to finance an incredibly expensive and evidently permanent occupation of the worthless craphole narco-state Afghanistan.
In fact, the billionaire will probably invest in a few start-ups of true value to the rest of us...
Touché, Ben.
Scott - Thank you. Great analysis and data mining.
-Tom
The daily life of a billionaire today is not all that much different from that of a median-income wage earner. Both have ready access to great food, a clean abode, cheap travel, cheap entertainment, great health care, and instant communications with just about anyone, anywhere in the world.
If only this were true.
Prior to Obamacare or Romneycare or whatever you want to call it, access to healthcare was not equal because a median-income wage earner with a pre-existing condition did not have access to affordable health care, while a billionaire, if they so chose, could self-insure.
So perhaps you are tacitly supporting the ACA???
Even with Obamacare/Romneycare and the Bush Medicare Drug Benefit, there are many drugs that even a low figure millionaire would have trouble affording longer-term.
Let's also not forget that an important reason there is "great food" is that the USDA has sufficient funds to inspect food, since none of us, not even billionaires, has the capacity to completely do so on our own.
Let's agree that full-funding for these inspections is never put at risk.
More specifically:
USA TODAY:
New cancer drugs are routinely priced at more than $100,000 a year — nearly twice the average household income.
Experimental cholesterol drugs — widely predicted to be approved this summer — could cost $10,000 a year
A drug for a subset of people of cystic fibrosis, a lung disease that kills most patients by their early 40s, commands more than $300,000 a year.
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