SaltyPoliticalMusings

Federal Reserve Report details Depth of Crisis

While we all know that the Great Recession has had a terrible impact across the board, the numbers that are finally coming out are still stunning.  Of course, the worst-yet-completely-expected highlight is that, while the middle class saw both their net worth and income take nosedives, the richest 10% gained net worth.  That is not presented to suggest that all those gains are ill-gotten.  But I think it becomes harder and harder as the recovery stumbles along and more numbers come out to argue that the system isn’t broken.  The vulnerable aren’t protected.  Reading the report via CNNMoney, I wanted to post some stats:

  • The average American family’s net worth dropped almost 40% between 2007 and 2010
  • The stunning drop in median net worth — from $126,400 in 2007 to $77,300 in 2010 — indicates that the recession wiped away 18 years of savings and investment by families
  • Much of the drop off in net worth — to levels not seen since 1992 — was attributable to a sharp decline in housing values, the Fed said
  • Making matters worse, income levels also fell during the tumultuous three-year period, with median pre-tax income falling 7.7% as earnings from capital gains all but disappeared
  • The report also indicated that families with more assets at the start of the recession were able to retain more of their net worth than less fortunate families
  • Families in the top 10% of income actually saw their net worth increase over the period, rising from a median of $1.17 million in 2007 to $1.19 million in 201o
  • Meanwhile, middle-class families who ranked in the 40th to 60th percentile of income earners reported that their median income fell from $92,300 to $65,900 over the same time period
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This entry was published on June 12, 2012 at 10:34 am. It’s filed under General News, Politics and tagged , , , , , , , , . Bookmark the permalink. Follow any comments here with the RSS feed for this post.

One thought on “Federal Reserve Report details Depth of Crisis

  1. This is going to have consequences. Thanks for shining the light on the problem.

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