Americans Continue to Regain Lost Wealth; U.S. Net Worth Rises to $77.3 Trillion; Mortgage Borrowing Rises for First Time in Recovery
The stage could be set for stronger economic growth next year, as a surging stock market and run-up in home values have helped Americans recoup nearly all the wealth they lost in the recession.</br></br>The net worth of U.S. households and nonprofit organizations--the values of homes, stocks and other assets minus debts and other liabilities--rose 2.6%, or about $1.9 trillion, in the third quarter of 2013 to $77.3 trillion, the highest on record, according to the Federal Reserve.</br></br>The Fed's figures aren't adjusted for inflation, but even after accounting for rising costs--using the Fed's preferred inflation gauge--Americans' net worth is at record levels. The figures also aren't adjusted for population growth, and the nation's wealth is roughly 1% short of its peak according to another commonly used gauge, the consumer-price index.</br></br>Still, the report shows American households' finances are making up more of the ground lost during the recession, which ran from December 2007 through June 2009, and that fundamental economic improvements are reaching more people.</br></br>After four years of slow growth, economists expect output to grow faster next year, partly because rebounding home prices and stocks are making more Americans feel wealthier--a trend that, in turn, could make them more inclined to borrow and spend, giving the economy a lift.