U.S. households’ net worth surpassed its previous peak in the first quarter of this year, according to newly released data from the U.S. Federal Reserve. The chart above shows total assets (the blue line) and total liabilities (the red line), with the difference being net worth (the green line).
That reached $70.3 trillion in the first quarter of this year, up from $67.3 trillion in the fourth quarter of last year and topping the $68.1 trillion of the third quarter of 2007, the previous peak. U.S. households’ net worth had dipped to $52 trillion in the first quarter of 2009 in the depths of the recession that followed the 2008 global financial crisis.
The recent bull run in equities and a revival of U.S. housing markets are the main reasons for the recovery. The numbers in the chart, which also include the balance sheets of non-profits, are nominal and aggregates. They take no account of the expansion of the population or any changes in price levels. U.S. households’ net worth would have had to have topped $73.1 billion to restore in inflation-adjusted terms all the wealth lost since the 2008 financial crisis broke. Nor do the numbers give any indication of how the wealth is distributed among U.S. households.