Americans’ net worth shrinks $1.33 trillion in 1Q

CEO of Central Bank

WASHINGTON – American households lost $1.33 trillion of their wealth in the first three months of the year as the recession took a bite out of stock portfolios and dragged down home prices. The Federal Reserve reported Thursday that household net worth fell to $50.38 trillion in the January-March quarter, the lowest level since the third quarter of 2004. The first-quarter figure marked a decline of 2.6 percent, or $1.33 trillion, from the final quarter of 2008. Net worth represents total assets such as homes and checking accounts, minus liabilities like mortgages and credit card debt. The damage to wealth in the first quarter came from the sinking stock market. The value of Americans’ stock holdings dropped 5.8 percent from the final quarter of last year. With wealth declining and unemployment rising, there are questions about how consumers — the lifeblood of the economy — will behave in the coming months. If they continue to spend, even at a subdued pace, the recession likely will end this year as predicted by Fed Chairman Ben Bernanke and other economists. However, if consumers hunker down and cut spending again, that could delay any recovery. In the final quarter of last year, Americans slashed spending at an annualized rate of 4.3 percent, the most in 28 years.
- Yahoo News

Wait let me get this straight…Our net worth drops a trillion dollars in a quarter, unemployment is on the rise, the housing market is in intensive care; and their only solution to save our economy is to make sure the poor people keep spending money? I think whoever is running the Central Bank needs to stop hitting that rock and blowing smoke up our ass - BEREZ

               
Posted Under: Americans net worth shrinks
This post was written by BerezObama on June 11, 2009 Comments (0)