Pew Research data show the wealthiest 7% of households' net worth gained 28% from 2009-2011, while the wealthiest (bottom) 93% of households' net ' worth have gained -4% over the same time period. Keep in mind this only takes into account the recovery, it does not include data on the recession. http://www.pewsocialtrends.org/2013/04/23/a-rise-in-wealth-for-the-wealthydeclines-for-the-lower-93/
I don't think this is too surprising or unusual - wages and employment tends to be a lagging indicator while the stock market is a leading indicator. So early in recoveries, financial assets would be expected to rise more quickly than anything else. But similarly, if you look at 2006 to 2008, the wealthy should have lost more than the middle class as well. I think a better analysis would be something like 2005 to 2015 - expand out the time frame and incorporate the full recession and recovery to see how the two groups were affected. I think you'd find similar patterns simply because the wealthy have been accumulated pretty much all new wealth in this country for over a decade now, but I think it would be a more objective look at the situation.
don't assume the former is at the expense of the latter (and the latter is all you should be concerned about)
If I had to assume, I would say the recovery has favored older households (who have paid off most of their mortgage) over younger households.
This is all due to the stock market. The wealthy typically have money in there and the poor do not. The stock market has risen to historic numbers over the past 5 years.
Yes, we can't possibly know anything about this - other than the fact that, since Reagan was president, a greater and greater concentration of wealth in this country has been collected in the untaxable accounts of a smaller and smaller sliver of the population. At a proportional rate, the standard of living and relative wealth of everyone else has slowly and steadily declined. It really is this simple - there is a finite amount of wealth at each given point. Increases and decreases in the supply quickly follow the same path. This is a zero sum game. We can talk about lagging indicators and such for hours (we really could) and, for some odd reason that I can't quite explain, never actually discuss the fact that I just mentioned above. Isn't it strange that, using the language of economics, we can't seem to say anything at all about this obvious fact? How weird! Here it is: A very small percentage of the ultra-rich are rapidly and, apparently, irredeemably hoarding a skyrocketing percentage of the total wealth in this country. Meanwhile, the rest of us (and by "us" I really mean all of us because none of those ultra-wealthy people post on this board) have seen our standards of living gradually slide down a greased pole since the 80s. Things have picked up for us once or twice, but never for very long. Money is power, and right now the powerful, from business and government, are ****ting all over the rest of us and laughing about it.
You can certainly talk about all those things. But if you're going to look at a 2 year period from 2009 to 2011 as your evidence for it, then you should probably consider factors specific to those 2 years. But if you want to have the larger discussion, the data set you should be looking at is a larger time frame. As is, the data in this particular article doesn't really tell us anything. Even in an economy that works the way you feel it should, you'd likely have the wealthy getting more of the wealth in the two years following a recession.
Or you could see this past two years as just a continuation of precisely the same dynamic that has been occurring over the past thirty years. It sure looks like it. The data set in this article is a replay of data sets that have been popping up all over the place for the past 20 years. This isn't anything new, it's not something unexplainable, it's not some stunning phenomenon that requires all of us to reserve judgment until we have more facts - it's exactly what it appears to be. A continuation of the same trend, another passing mile marker on the same road we've been stuck on for decades. So, the wealthy "should be" getting more wealth in the two years following a recession, as well as during the recession, as well as the two years before the recession, as well as the twenty years before the recession ... This isn't new. This is just one more article added to the pile of articles that all say, more or less, the same thing.
I do not agree that all of it is attributed to the stock market. While rich households have more stock and bond wealth than poor households, the reduction in poor household wealth is probably due to unemployment, greater exposure to unconventional mortgages and changes in consumption behavior due to the recession.
Untaxable, or tax deferral and deductible? See, 401(k) and REITs. Stock markets are a great example of how wealth can be created through speculation, and bankruptcy shows that not all debt is paid back. Can we therefore call it zero-sum or finite if someone has legal recourse to not pay a debt?
I do not know what your larger point is. Are you trying to politicize the issue by blaming Reagan for disparity, or blaming the rich for wanting to get richer?
I find the 7/93 split to be suspicious. Why'd they pick 7%? What would the growth be like if they'd gone with the top 6%?
What I want to know is how can 75% of the american households have wealth less than 150K. That is everything from home to stocks to IRA, etc. That is just so low.
Most Americans do not own their home outright so the value of the home in their net worth is little to none. Many Americans do not own their cars outright due to the trade in culture we have. That's additional debt in place of an asset. Most Americans have credit card debt. Many Americans have credit card debt that is greater than their savings/investments accounts. Many Americans have student loan debt. While not all of those things necessarily hurt you in real time economic positioning (no interest debt is not necessarily a hindrance) it definitely hurts your net worth. An American who has a home valued at $150,000 that they just purchased and owe $110,000 on, with a brand new car that they financed over 6 years that they owe $30,000 on with a value of only $25,000, $25,000 in student loan debt and $10,000 in credit card debt has what net worth?
