The Paradox of Debt by Richard Vague
Author:Richard Vague
Language: eng
Format: epub
Publisher: Forum
With inflated prices, nominal GDP grew, but this was because private sector debt increased sharply, from $931 billion to $1.5 trillion, while total government debt, including state-level and local debt, continued to grow higher. GDP adjusted for inflation â real GDP â was down in the first two quarters of 2022 as compared to the final quarter of 2021; for the first three quarters of 2022 it was up only a modest 1.9 percent as compared to the first three quarters of 2021. Higher inflation took a large bite out of real growth.
On the net worth side, the trends were more unfavorable, as shown in Figure 6.2. By September 2022, the value of household equities had tumbled in value and trends in real estate prices were mixed. The overall effect was that household net worth was down by 4.6 percent for the snapshot taken at the end of the third quarter of 2022, from $150.1 trillion to $143.3 trillion.38
Yet, these values were still well above the levels in 2019, just before the pandemic (see Figure 2.6). And those 2019 levels were themselves highs for the period following the Global Financial Crisis of 2008. For these reasons, it was implausible to characterize these assets on the US balance sheet as being undervalued, even after correction. This left many economic observers concerned that household net worth would continue to reverse, at least somewhat, in the near future.
Such a drop in net worth has ample precedent. During the 2008 financial crisis, net worth as a percentage of GDP fell by 16 percent and then took a full eight years to return to its pre-crisis level. The largest drop in household net worth to GDP before then was 12 percent, which occurred from 1972 to 1974, during the worst years of the 1970s oil and inflation crises. Then, net worth also took a number of years to return to its previous peak.
Download
This site does not store any files on its server. We only index and link to content provided by other sites. Please contact the content providers to delete copyright contents if any and email us, we'll remove relevant links or contents immediately.
International Integration of the Brazilian Economy by Elias C. Grivoyannis(71540)
The Radium Girls by Kate Moore(11585)
Turbulence by E. J. Noyes(7675)
Nudge - Improving Decisions about Health, Wealth, and Happiness by Thaler Sunstein(7210)
The Black Swan by Nassim Nicholas Taleb(6732)
Rich Dad Poor Dad by Robert T. Kiyosaki(6140)
Pioneering Portfolio Management by David F. Swensen(6050)
Man-made Catastrophes and Risk Information Concealment by Dmitry Chernov & Didier Sornette(5614)
Zero to One by Peter Thiel(5463)
Secrecy World by Jake Bernstein(4355)
Millionaire: The Philanderer, Gambler, and Duelist Who Invented Modern Finance by Janet Gleeson(4062)
The Age of Surveillance Capitalism by Shoshana Zuboff(3964)
Skin in the Game by Nassim Nicholas Taleb(3951)
The Money Culture by Michael Lewis(3816)
Bullshit Jobs by David Graeber(3801)
Skin in the Game: Hidden Asymmetries in Daily Life by Nassim Nicholas Taleb(3707)
The Dhandho Investor by Mohnish Pabrai(3542)
The Wisdom of Finance by Mihir Desai(3504)
Blockchain Basics by Daniel Drescher(3308)
