U.S. Household Wealth at Record High
U.S. household wealth swelled to a new record in the second quarter of 2004, while borrowing outside the financial sector grew at a slower pace, the Federal Reserve said on Thursday. In its quarterly “Flow of Funds” report, the Fed said household balance sheets increased 1.4 percent to $45.907 trillion in the second quarter, compared with an upwardly revised $45.270 trillion in the first quarter of this year. First-quarter household wealth was initially reported at $45.153 trillion, which had been a record high.
Much of the increase in household net worth came from rising real estate values. The Fed said the market value of household real estate, which includes owner-occupied homes, second homes and vacant land, rose 2.9 percent to $15.713 trillion in the second quarter. The value of U.S. stocks were nearly steady at $6.066 trillion in the second quarter, compared to $6.072 trillion in the first quarter. Mutual funds nudged 1.7 percent higher.
I’m not sure these numbers will resonate with the voters but it appears to be further evidence that the economy is in good shape. Certainly, President Bush has almost nothing to do with the price of real estate and only slightly more to do with the value of stock. Then again, he has little control over job growth and he gets blamed for the lack of it.