Household Wealth Surges to New Record
The net wealth of American households has surged to a new record. The increase in housing prices and the rise in the stock market have pushed household net wealth to $48.53 trillion.
In its quarterly “Flow of Funds” report, the central bank said household balance sheet values rose nearly $2 trillion above $46.59 trillion in the third quarter. U.S. household net worth pierced a new record in each of 2004’s four quarters.
One caveat: I don’t know if these numbers have been adjusted for inflation. Also, these numbers are not adjusted for seasonal factors.
Also increasing is that debt is also increasing,
For 2004 as a whole, the Fed said debt incurred by households, non-financial businesses and the federal and local governments rose 8.5 percent compared with 8.0 percent in 2003.
The total level of U.S. non-financial debt outstanding at the end of 2004 was $24.2 trillion, the Fed said, of which government debt made up $4.4 trillion.
Household debt grew 9.4 percent in the fourth quarter after a 11.5 percent expansion in the earlier period. The Fed said the quarterly deceleration reflected slower growth in mortgage debt and consumer credit.
Household debt increased 11 percent for 2004 as a whole, compared with a 10 percent gain in 2003, the Fed said. It attributed the 2004 pickup to higher demand for mortgage debt, as well as a slight rise in consumer credit. (Additional reporting by Michael Flaherty in New York).