The wealth of the top 1% of Americans reached a record figure of 44,600 billion dollars in the fourth quarter of 2023. According to US media reports, the wealth of the 1%, defined by the Fed as those with wealth greater than 11 million dollars, increased by 2,000 billion dollars in the quarter under consideration.
All the gains have come from stock holdings thanks to the year-end rally, and economists say the stock market rally is giving a further boost to consumer spending through what's known as the "wealth effect."
“The wealth effect from soaring stock prices is a powerful boon to consumer confidence, spending and overall economic growth,” said Mark Zandi, chief economist at Moody's Analytics. “Of course, this highlights a vulnerability in the economy should the stock market falter,” he added. “This is not the most likely scenario, but it is a scenario given that stocks appear vastly (over)valued.”
Reproduction reserved © Copyright ANSA