The net worth of Americans has risen to its highest number in decades thanks to Donald Trump’s economic and tax policies, a report notes.
According to Market Watch, household and nonprofit net worth rose by $2.19 trillion in the second quarter this year.
As the economic cycle grows older — and as the real estate sector bemoans a lack of available homes that has driven up house prices — household net worth continues to gain.
Market Watch added:
Meanwhile, domestic nonfinancial debt rose 4.6% as business debt also grew by 4.6% and federal government debt jumped by 6.9%.
Household debt grew a more modest 2.9% while state and local government debt actually fell, falling 0.4%.
The cash that corporations are holding on their balance sheet dipped slightly to $4.35 trillion from $4.38 trillion. The Fed also changed its definition of liquid assets to include the value of companies’ stocks and mutual funds that they hold, a revision that added $2.17 trillion to the total, a notable shift as companies continue to purchase their own stock.
As the Fed boosts interest rates, companies are getting more exposed to the short end of the curve. The ratio of short-term debt to the total reached 30.1% from 27.9% in the first quarter, and the highest level since the third quarter of 2009.
Going along with this news, the stock market hit another high this week.
As the Wall Street Journal reported:
The Dow Jones Industrial Average and S&P 500 set new highs Thursday, kindling hopes among some investors that buoyant U.S. stocks are on track to exceed Wall Street’s performance expectations for 2018.
The blue chips surged more than 250 points to cap a three-day run of gains, the latest leg of a nine-year rally that hurtled the index to its first record close since Jan. 26. The stock market’s rise has coincided with a pause in the U.S. dollar’s climb and a recent spike in government-bond yields, a signal investors are viewing next week’s expected increase in interest rates from the Federal Reserve as a testament to the strength of the economy.
Thursday’s rally pushed the Dow up 7.8% for the year, while the S&P 500, which also set a new record, has added 9.6%—putting it within striking distance of the 2018 price targets of banks such as Goldman Sachs and Bank of America Merrill Lynch.
This not only never happened under Barack Obama, but as Stephen Moore wrote this week, “This economy is definitely not Obama’s recovery.”
Barack Obama is trying to take credit for the booming economy under President Trump. “When you hear how great the economy is doing right now,” Obama said on the campaign trail for Democratic candidates a few days ago, “let’s just remember when this recovery started.”
By this logic, the Kingston Trio laid the groundwork for the Beatles.
But the contrast in economic performance between the two presidents is undeniable. Obama’s multitrillion-dollar spend-and-borrow policies produced 2 percent growth. In his final year, Obama handed off to Trump an economy that was limping at 1.6 percent.
After only 18 months in office, Trump has elevated growth to 3 percent on an annual rate and the latest projections are that the growth rate for the second and third quarter (which ends Sept. 30) will be over 4 percent. One might say all it took to get the economy really crackling was getting Obama out of office.
Yep. This wonderful upswing after Obama’s dismal eight years belongs to Trump. But it also belongs to everyone who voted for Trump.
Don’t let that vote go to waste in November during these upcoming midterm elections, America.
Follow Warner Todd Huston on Twitter @warnerthuston.
The views expressed in this opinion article are solely those of their author and are not necessarily either shared or endorsed by EagleRising.com