Friday, September 21, 2018

CHRISTOPHER RUGABER - Buoyant stocks lift US household wealth, mainly for affluent

Tweet by Jonathon Tapper

1) most major industries are now monopolies/oligopolies 2) top 10% own almost all stock in monopolies/oligopolies Most transactions in the economy send money from the have nots to the haves.

AP News

The Fed's report came on a day when a wave of buying on Wall Street sent U.S. stocks surging and lifted both the Dow Jones Industrial Average and the Standard & Poor's 500 stock index to all-time highs. The Dow has gained nearly 8 percent this year, the S&P nearly 10 percent.

Household net worth reflects the value of assets like homes, bank accounts and stocks minus debts like mortgages and credit cards. The data aren't adjusted for inflation or population growth.

They also don't reflect the experiences of most U.S. households. Stock market wealth has been flowing disproportionately — and increasingly — to the most affluent households. The richest one-tenth of Americans own about 84 percent of the value of stocks. That's up from 81 percent just before the Great Recession began in late 2007.

That trend is concerning to some economists, who regard such sizable disparities in wealth as unhealthy for an economy. When lower- and middle-income people don't share much in overall prosperity, many are forced to absorb more debt and take other financial risks.

"I would be happy in a world where we saw big stock increases — if stocks were more broadly distributed across the population," said Josh Bivens, director of research at the liberal Economic Policy Institute. "The fact that is where most of the gains are going is worrisome."

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