The following chart is from the CalculatedRisk post of June 6, 2019 titled “Fed’s Flow of Funds: Household Net Worth Increased in Q1.” It depicts Total Household Net Worth as a Percent of GDP. The underlying data is from the Federal Reserve’s Z.1 report, “Financial Accounts of the United States“:
(click on chart to enlarge image)
As seen in the above-referenced CalculatedRisk post:
According to the Fed, household net worth increased in Q1 2019 to $108.6 trillion, from $104.0 trillion in Q4 2018.
The Fed estimated that the value of household real estate increased to $26.1 trillion in Q1. The value of household real estate is now above the bubble peak in early 2006 – but not adjusted for inflation, and this also includes new construction.
As I have written in previous posts concerning this Household Net Worth (as a percent of GDP) topic:
As one can see, the first outsized peak was in 2000, and attained after the stock market bull market / stock market bubbles and economic strength. The second outsized peak was in 2007, right near the peak of the housing bubble as well as near the stock market peak.
I could extensively write about various interpretations that can be made from this chart. One way this chart can be interpreted is a gauge of “what’s in it for me?” as far as the aggregated wealth citizens are gleaning from economic activity, as measured compared to GDP.
The Special Note summarizes my overall thoughts about our economic situation
SPX at 2835.30 as this post is written