U.S. household net worth decreased by $1.3 trillion in the first quarter of 2009. This was due in part to decreases in stock market and real estate values. The gory details are here.
Here is a table for some context:
| Year | Net Worth (Billions of Dollars) |
|---|---|
| 2002 | 40498.0 |
| 2003 | 46363.2 |
| 2004 | 51830.1 |
| 2005 | 57997.8 |
| 2006 | 62205.8 |
| 2007 | 62591.6 |
| 2008 | 51706.2 |
| 2009 (Q1) | 50376.5 |
It will be hard to recover from this particularly for working class Americans. That is a huge hit. Sure much of it was inflated by debt but the problem is that people will have to get use to a lower living standard because of this hit especially for those who were getting ready to retire.
The good news is that the "decline has slowed." Yeah, right tell that to someone in Michigan or Ohio or even California.
how much of that is home evaluations?
I would consider the home evaluations with their bubble prices to be fictional wealth...
it hid the Bush years economic Armageddon on the U.S. middle class.
At least household debt contracted.
It is huge.
After backing out Nonprofit organizations. Household Real Estate according to fair market value is about 30% of total assets.
RebelCapitalist.com - Financial Information for the Rest of Us.
so the headlines
and net worth are a little misleading, kind of like Enron evaluations. ;) Unless of course you cashed out about 2007 and then rented.
Your last sentence is key
Because even before the bubble must people's most valuable asset was their home (401ks too small and pensions practically nonexistent). Many people were expecting to use that equity for retirement or at least roll it over into something else.
RebelCapitalist.com - Financial Information for the Rest of Us.