US Household Wealth Increases $1.83-T on Stocks…

US Household Wealth Increases $1.83-T on Stocks…

$DIA, $SPY, $QQQ, $RUTX, $VXX

US household wealth kept rising in Q-2, though at a slower pace than at the start of the year, as the stock market hit fresh highs and home-price gains remained intact.

Net worth for households and non-profit groups increased $1.83-T, or 1.6%, to $113.5-T after an upwardly revised 5% gainer in the prior period, Federal Reserve data showed. 

Household debt growth accelerated to a 4.3% annual pace, the fastest since Y 2017, from a downwardly revised 2.1% rate in the prior Quarter.

Key Insights from the Report

  • US stocks rose at a slower pace in Q-2 following a sharp rebound in the prior 3 months, on increasing calls for the Fed to cut interest rates and then-cooling trade tensions with China. Property values, a Key source of wealth, also decelerated but kept rising amid a shortage of inventory and lower mortgage rates.
  • The value of equities directly and indirectly held by households and nonprofit groups increased $893.7-B from the prior Quarter. The value of real estate rose $257-B.
  • Total business debt climbed at a 4.4% annual pace, to $15.7-T. Such obligations are the equivalent of almost 75% of GDP (gross domestic product).
  • Fed Chairman Powell said in a press conference last week that business-sector debt relative to GDP is high, though companies have also grown. “That’s a real issue, but what it really represents is a potential amplifier of a macroeconomic downturn,” though it would not be the cause a downturn. He added that “households are in very strong shape.”
  • Consumer debt growth accelerated, with mortgages rising at a 3.2% pace and other credit rising 4.6%. That lifted the total household debt to $15.8-T with non-mortgage credit edging up to $4.1-T.
  • Federal government debt increased at a 2.1% annual rate after jumping 9.8% the prior Quarter. The federal deficit is projected to widen to $1-T by FY 2020. State and local government debt was down 2.5%, the 6th straight decliner and biggest drop since Q-1 of Y 2018.

Monday, the major US stock market indexes finished flat at: DJIA +14.92 at 26949.99, NAS Comp -5.21 at 8112.46, S&P 500 -0.29 at 2991.82

Volume: Trade on the NYSE came in at 821-M/shares exchanged

HeffX-LTN’s overall technical outlook for the major US stock market indexes is Neutral with a Bullish bias with Key indicator MACD Very Bullish in here.

Making and Keeping America Great!

Stay tuned…

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Paul Ebeling

Paul A. Ebeling, polymath, excels in diverse fields of knowledge. Pattern Recognition Analyst in Equities, Commodities and Foreign Exchange and author of “The Red Roadmaster’s Technical Report” on the US Major Market Indices™, a highly regarded, weekly financial market letter, he is also a philosopher, issuing insights on a wide range of subjects to a following of over 250,000 cohorts. An international audience of opinion makers, business leaders, and global organizations recognizes Ebeling as an expert.

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