Re: Nr. 2 - Households: Another Quarter Older And Deeper In Debt (E)

verfasst von Cosa, 21.09.2002, 17:14

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<font size="5">Households: Another Quarter Older And Deeper In Debt </font>

The Fed finally got around to releasing its second-quarter flow-of-funds data this week. And what did it show? Households went deeper into debt, and their net worth continued to sink. The economy is in a foot race. Will businesses start to spend more on plant, equipment, and labor before consumers collapse under their heavy debt loads? Although we do not expect consumers to collapse in the fourth quarter, we believe they will not continue to shop at their third quarter frenzied pace. We do not expect business to pick up the slack.

Let's look at some nuggets relating to the household sector from the flow-of-funds data. Chart 1 shows that household leverage scaled to yet new postwar record heights in the third quarter. Way to go!




Another nugget from the flow-of-funds report was that household net worth fell by 3.43% in the third quarter. In the nine quarters ended Q3:2002 - that is, since the peak in the stock market -- households have suffered a cumulative 7.68% decline in their net worth. As Chart 3 shows, this drop in household net worth is unprecedented in the postwar era




Paul Kasriel

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gesamter Thread:

• Flow of Funds - Artikel (E) - Cosa, 21.09.2002, 17:03
  • Re: Nr. 2 - Households: Another Quarter Older And Deeper In Debt (E) - Cosa, 21.09.2002, 17:14
    • Re: Nr. 3 - The U.S. International Investment Position At Year-End 2001 (E) - Cosa, 21.09.2002, 17:29
    • Re: Nr. 2 - Households: Another Quarter Older And Deeper In Debt (E) Danke!! (owT) - Popeye, 21.09.2002, 17:39