View Full Version : ON Thursday; Fed estimated & announced America's Net Worth

03-11-2005, 04:27 PM
Article in today's Los Angeles, CA Times (Mar 12, 2005) regarding Net Worth of US household & nonprofit groups indicates:

the net worth of U.S. households rose to a record $48.5 trillion in the fourth quarter, so the Federal Reserve mentioned on Thursday. (how Fed techniques for coming up with this datum is probably a good estimate -- I hope)

"The Fed said total assets owned by households were worth $59.2 trillion at the end of the fourth quarter. Subtracting total debt of $10.7 trillion left the net worth figure of $48.5 trillion."
The Fed counts nonprofit organizations' assets and liabilities with household sector data.

Recent gross value of residential real estate was $17.2 trillion minus mortgage debt of $7.5 trillion equals Americans' homes were worth a net $9.7 trillion.

My questions are (could any of you perhaps add a few pertinent facts to the best of your ability to enlighten me some. Your opinions would be appreciated:

Concerning the total debt of $10.7 trillion, does this debt include the United States' foreign debt? Or is this foreign in a different category? My opinion: I think the foreign is included in this total debt of $10.7 trillion.

My other question is a fantasy hypothetical what-if question -- it is:

Assume every American Household and non-profit group coughed-up its equal share to pay off the total debt of $10.7 trillion. This would be about twenty percent of every household's and non-profit group's net worth. Of course this would never happen, but assuming it did happen - then what would happen. Some things might be:

(1) The Fed will call all notes, bills and bonds -- pay off everybody.

(2) Foreigners would end up with a lot of cash. What would they do with all of this cash if they couldn't buy US treasuries. They could buy up a lot of US real estate and US securities (pump up the markets).

(3) Also, assume certain rich guys have about 20% of their net worth in US treasuries which is exactly equal to their contribution to wipe out the debt. What this would amount to is a permanent moratorium on their treasuries. They would just be out their treasuries.

Any comments would be appreciated.... Thank you

03-11-2005, 09:27 PM
the net worth of U.S. households rose to a record $48.5 trillion

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So Bill Gates is worth a little less than .1% of America. Not too shabby!

03-11-2005, 10:20 PM
That seems high to me.

$59T / 300M = $196,666 for every single person in the U.S.

03-12-2005, 12:45 AM
Net Worth of US household & nonprofit groups

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total debt of $10.7 trillion & mortgage debt of $7.5 trillion

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The $10.7 trillion does not include debt held by the government, only personal debt. Of the personal debt, $7.5 trillion is in real estate and $3.2 trillion is in other liabilities such as car payments, credit cards, etc.

To see the real national debt go to national debt (http://www.publicdebt.treas.gov/opd/opdpenny.htm) or go to debt clock (http://brillig.com/debt_clock/) to see how much every citizen owes right now.