Americans Net Worth Dropped 1.33 Trillion in 1Q
If you have felt like your wallet was shrinking over the last several months, at least you can have some comfort because you are not alone. In fact, the US Federal Reserve reported that US assets strunk over a trillion dollars in the first quarter of this year. The net worth loss was largely caused by shrinking home values and portfolios, though, so if things ever climb back up, we may regain some of this without doing much except holding on.
Spending is Conservative Too
Of course, consumers are nervous too as they watch their net worth sink. And their low spending habits cannot really help the recession end sooner. The market, mostly, drives stock prices up and down. If investors, for instance, are scared to buy stock, the price will stagnate. Likewise, if consumers are not buying new cars or flat screen tvs, but nursing the old models for a few more years, it will be difficult for producers to thrive.
But we do have some good news about the economy. Following 2 monthly declines, retail sales picked up half a percent in may. That is according to the Commerce Department. And the number of newly laid off workers has dropped to the lowest number since late January.
So even though our assets are down, we Americans may feel better about our future incomes. These days, any news is good news.
The Great American Middle Class Squeeze Who Did the Bailout Help
