A Rise in Wealth for the Wealthy; Declines for the Lower 93%

+Bob DeMarco

During the first two years of the nation’s economic recovery, the mean net worth of households in the upper 7% of the wealth distribution rose by an estimated 28%, while the mean net worth of households in the lower 93% dropped by 4%, according to a Pew Research Center analysis of newly released Census Bureau data.

HomeOwner Wealth Dropped $2.4 Trillion in 2008

The value of homes in the U.S. dropped $2.4 Trillion in 2008.

8.3 million homeowners now owe more than their house is worth.

Source First American CoreLogic.

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Bob DeMarco is a citizen journalist, blogger, and Caregiver. In addition to being an experienced writer he taught at the University of Georgia , was an Associate Director and Limited Partner at Bear Stearns, was CEO of IP Group, and is a mentor. Bob currently resides in Delray Beach, FL where he cares for his mother, Dorothy, who suffers from Alzheimer's disease. Bob has written more than 500 articles with more than 11,000 links to his work on the Internet. His content has been syndicated on Reuters, the Wall Street Journal, Fox News, Pluck, BlogCritics, and a growing list of newspaper websites (15). Bob is actively seeking syndication and writing assignments.

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Household Wealth Plunged In ‘08, Reversing Rise

Borrowing for second homes accounts for part of the large increase in debt over the last five years. This is something that is not being discussed or factored into the current housing situation. An enormous amount of second homes are going into foreclosure and even more are on the market for sale. This overhang in the housing market is likely to continue for a long time. Is anyone in the government discussing supply and demand as they look for a quick fix for the housing crisis?

The drop in the stock market is hurting the newly retired and really weighing on Baby Boomers.

clipped from blogs.wsj.com U.S. household wealth appeared to have plummeted in 2008 in the face of falling values for stocks and homes, a Federal Reserve report showed, more than reversing gains achieved over the previous three years. According to the Fed’s survey of consumer finances, released Thursday, average net worth is estimated to have fallen 22.7% from 2007 until October 2008. The median, or midpoint, fell a more modest 17.8%, suggesting declines were centered among wealthier families. The share of households with loan payments exceeding 40% of their income rose 2.5 percentage points between the 2004 and 2007 surveys, to 14.7%. Borrowing for second homes was a big factor pushing up debt between 2004 and 2007, the Fed said. –Brian Blackstone