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>I trust a technical Fed report
>As a formal central bank economist So you trust in what you already have faith in? That's not a source that inspires confidence in our discourse. >That report is half speculation about the future ("looks set to end soon, >with excess household savings likely to be depleted by year-end") As other pointed out in this thread this data suggests differently. https://fred.stlouisfed.org/series/PSAVERT
All trends are speculations about the future. From your own report: "By this metric, in the 2022 survey, 82 percent of families in the top decile of the usual income distribution saved, compared with 66 percent of families in the upper-middle segment and 43 percent of families in the bottom half. Between 2019 and 2022, the overall fraction of families that saved edged down from 59 percent to 56 percent, with decreased saving observed among all three segments." So savings spiked then disappeared at the same time all these positive numbers on assets began to surface. How interesting. Yet, "Among families in the bottom quartile, median net worth was $400 in 2019 and $3,500 in 2022, and *mean net worth was negative $15,700 in 2019 and negative $5,300 in 2022.* Among families in the top decile, median net worth was $3,012,500 in 2019 and $3,794,600 in 2022, and mean net worth was $6,641,800 in 2019 and $7,810,500 in 2022." In addition to, "Younger people – those below the age of 35 – are far more likely to rent than are other age groups: About two-thirds (65.9%) of this age group lives in rentals. This compares with, for example, 42% of those ages 35 to 44, and less than a third (31.5%) of 45- to 54-year-olds." (https://www.pewresearch.org/short-reads/2021/08/02/as-nation...) So the growth in assets from homeownership doesn't make sense for a large majority of the population; but, for those who rent the increase in personal savings makes a ton of sense given the CDCs moratorium. The increase in upper class wealth makes sense as many bought additional homes; which fits with the ever increasing prices in homes. The decrease in savings and the rising cost of borrowing would indicate trouble ahead. The confidence gained from well manufactured data is fleeting. |
I trust central bankers to not straight up make up or lie about facts, because I worked in one and formed an impression of what the institutional culture is like, yes. I did volunteer that information to you though.
The rest of what you're saying sounds like older people have seen increases in net worth because of asset price inflation, and younger people have seen increases in net worth because of covid-related measures ("CDCs moratorium"). That sounds right to me too!