US Household Wealth Rises.. At Last
U.S. households' net worth rose by $2 trillion to $53.1 trillion in the second quarter, the first increase since before the recession began in 2007, Federal Reserve data showed on Thursday.
The increase in wealth came in a period that saw the first rise in household real estate assets since the fourth quarter of 2006, and huge gains in global financial markets.
However, even with the $2 trillion rise, household net worth was still well below the $65.3 trillion peak recorded in the third quarter of 2007, which was shortly before the start of the recession in December 2007.
That steep drop in wealth has put a damper on consumer spending, which normally accounts for about 70 percent of U.S. economic activity, and has encouraged households to boost savings.
In a sign that savings were on the rise, household ownership of U.S. Treasury securities rose to $605.9 billion in the second quarter from $576.4 billion in the prior period. The latest figure is up about 65 percent from a year earlier, and is the highest since the first quarter of 2006, the Fed said.
The quarterly Flow of Funds report also showed households and nonfinancial businesses pared debt, while the federal government piled more on as it stepped up recession-fighting efforts.
Household debt contracted at a 1-3/4 percent annual rate in the second quarter, the fourth consecutive quarter of declines, reflecting drops in both mortgage debt and consumer credit such as credit cards.
This is a positive for the American consumer but a negative for the pricks who got us in this mess. They can't push this "recovery" bullshit unless we're burning up our credit cards in the malls on big screen TVs and crappy lead-based Chinese toys. So, TPTB, whatcha gonna do?