Report: Household Wealth Plummeted by $13.5 Trillion This Year

American households’ real wealth fell $13.5 trillion in the first three quarters of 2022, according to a MarketWatch report.

The 8.6 percent drop from January to September is the second fastest decline on record, behind the financial crisis of 2008/2009. Record-high inflation under the Biden administration is causing a decrease in the purchasing power of assets and liabilities, MarketWatch reports:

Nominal net worth fell 4.6% to $143.3 trillion, as the market value of assets fell by $6 trillion and liabilities rose by about $900 billion. Households’ balance sheets—assets minus liabilities—were propped up by a 10% increase in home equity, which is the greatest source of wealth for most American families.

But the loss in real wealth from January through September was about twice as large as the nominal loss—$13.5 trillion in current dollars—after accounting for the rapid inflation experienced this year. Inflation makes both debts and liabilities worth less in terms of purchasing power.

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