Mid Day Money Blog

-I came across this blog this afternoon on CNN.com and thought it was pretty interesting. Although our country been talking all this "reccession" talk, what they probably do not know is Americans net worth rose 2 Trillion Dollars in the Second Quarter since President Obama has been in office. According to this article written by Tami Luhby, stocks rose 22% and mutal funds rose 15%. Check out the article-

NEW YORK (CNNMoney.com) -- Tami Luhby

After nearly two years of declines, the net worth of Americans rose by $2 trillion to an estimated $53.1 trillion in the second quarter compared with the first three months of the year.

The soaring stock market accounted for much of the gain. Stock holdings rose by 22% to $6.3 trillion, while mutual funds' value jumped 15% to $3.7 trillion, according to a Federal Reserve report released Thursday.

After suffering horrific declines in the wake of the global financial crisis, the stock market began recovering this spring. The S&P 500 gained 15.2% in the April through June period for its best quarter since the final three months of 1998. The Dow gained 11% and the Nasdaq rose 20% -- posting their best three-month periods since the second quarter of 2003.

Real estate also rose in value for the first time since the end of 2006. Household real estate assets went up 2% to $18.3 trillion, after plummeting since the end of 2006.

Still, Americans have a long way to go before they recover the wealth they once had. U.S. net worth peaked at $65.3 trillion in the third quarter of 2007. That's 18.7% higher than the current level.

Much of the nation's wealth had been tied to the recent booms in the housing market and on Wall Street. At the end of 2006, Americans' homes were valued at nearly $22 trillion.

And in the following year, their stock holdings topped out at $10.2 trillion and their mutual fund portfolio at $4.9 trillion.

The debt story: At the same time, consumers continue to pay off their bills. Household debt shrunk by an annual rate of 1.7% in the second quarter, the fourth consecutive decline. Debt loads had never contracted until the current downturn.

Businesses are also pulling back on the debt they carry. Debt contracted at an annual rate of 1.8%, the second decline in a row.

Governments, however, are loading up on debt as they try to prop up the economy. Federal government debt ballooned 28.2%, the fourth straight increase, while state and local governments increased their debt levels by 8.3%.

Source CNNMoney.com

http://money.cnn.com/2009/09/17/news/economy/Net_worth_rises/index.htm?postversion=2009091713