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Americans Save Money, Grow Richer

Posted by: : Paul EbelingPosted on: March 12, 2015 Americans Save Money, Grow Richer

Americans Save Money, Grow Richer

Over the past year US unemployment dropped, US stocks reached record highs, and US gasoline prices dove. Americans got richer, banked money, paid down mortgages and slowed spending.

As the net worth of American households rose 5.2% in Y 2014, to $82.9-T, new US Federal Reserve data show the value of outstanding mortgages fell in the same frame.

American homeowners now own 54.5% of their real estate, up from less than 40% in the 3 years earlier. And, most other kinds of debt are up slightly. The Fed’s measure of consumer credit rose $218.4-B last year, to $3.3-T. The strongest growth in debt is confined to 2 areas; student loans and auto loans which accounted for more than 80% of the rise.

Americans also saved, adding 6% more cash to bank and money-market funds last year, the Fed data show. Stock and mutual fund assets also rose along with the Bull Market.

Homebuilders and retailers would prefer consumers start spending that money on new homes and wardrobes, either of which would accelerate the economic recovery.

The rate of home ownership is at a 20-yr low, according to data from Bank of America (NYSE:BAC).

It is even worse for young people: The rate for those in their early 30s has dropped to 47.1 percent from 57.4 percent since Y 2004. If US banks started lending more freely, or millennials started house-hunting, the economy would get a big boost.

Consumers’ acting responsibly is a sign that the US economy may have years more to expand before the risk of a recession.

Stay tuned…


Paul Ebeling

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Paul Ebeling

Pattern Recognition Analyst, equities, commodities, forex
Paul Ebeling is best known for his work as writer and publisher of “The Red Roadmaster’s Technical Report” on the US Major Market Indices™, a highly-regarded, weekly financial market letter, where he enjoys an international audience among opinion makers, business leaders, and respected organizations. Something of a pioneer in online stock market and commodities discussion and analysis, Ebeling has been online since 1994. He has studied and worked in the global financial and stock markets since 1984.

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