As seen in the September 15 post (“September 13 Gallup Poll On Upper-Income Americans’ Economic Confidence“) lately there appears to be a significant lessening of economic confidence among “upper-income” Americans; and, as seen in the poll, “This is the first month since the financial crisis of late 2008 and early 2009 that upper-income Americans are more pessimistic about the future direction of the U.S. economy than other Americans.”
One question that may arise is how the wealthy and ultra-wealthy will be ultimately impacted in severe economic weakness, i.e. conditions most will label a Depression. Of course, in the last 100 years or so, The Great Depression is the only episode of such an environment in the United States. While to my knowledge there is no definitive study of loss of wealth among the most affluent during The Great Depression, it appears as if many of the wealthiest Americans during the period experienced a pronounced reduction in wealth. Some, including the most wealthy and influential of the day, “lost everything.” One documentary of the period that illustrated this facet was “The Crash of 1929” that I highlighted in the July 8 post.
This current economic and investment environment is one in which large percentages of wealth can be quickly lost. I base this statement on many factors, one being the existence of many asset bubbles, which I have written of extensively.
The Special Note summarizes my overall thoughts about our economic situation
SPX at 1164.97 as this post is written