Friday, February 24, 2006

The Wealthy Are Doing Well. The Rest Of You, Don't Quit That Day Job

by Tom Bozzo

Here are some charts of the latest distribution of wealth data, from yesterday's Federal Reserve Bulletin article [PDF] reporting results from the 2004 Survey of Consumer Finances. The headline result was that median net worth, measured in 2004 dollars (i.e., adjusted for inflation), rose from $91,700 in 2001 to $93,100 in 2004; the differences are not statistically significant.

Picture 12

The upper percentiles do so well, relative to the rest of the distribution, that it's nearly impossible to pick out variation in the lower wealth groups. Here's the portion of the graph excluding the top and next-to-top groups (i.e., the 95th and 82.5th percentiles, respectively).

Picture 17

What's clear is that notwithstanding the housing boom, there has been nearly no qualitatively significant increase in wealth for any group outside the top between the 2001 and 2004 surveys. That's Bushonomics for you. The bottom line, the 12.5th percentile (i.e., the median net worth for the bottom quartile) remains as close to zero as makes no odds.
The Age of Aquarius changed overnight
To an Age of Economists serving the right.
Anon, if only economists were so influential. Those management consultants, on the other hand...
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