U.S. Household net worth rose
U.S. Household net worth rose at a solid 6.8% rate in Q3 to $113.5 tln, according to the Fed's Z.1 report, with price gains for both equities and real estate. Analysts expect a larger 9% growth rate for net worth in Q4 given the big stock price climb into December. The asset component rose at a 6.5% rate in Q3 and is likely rising at a larger 9% rate in Q4, while liabilities grew at a restrained 4.5% rate in Q3 that analysts assume will be repeated in Q4. Asset value growth in Q3 included a 3.2% growth pace for real estate, and a 7.9% growth pace for financial asset values. Net worth in Q3 is 106% above the $55.0 tln cyclical-trough in Q1 of 2009, and asset values have risen 88% over that period. Yet, liabilities have risen just 15% over that period, and are up 19% from the much later cyclical-trough for that measure of $13.6 tln in Q1 of 2012. That bottom marked a hefty 7.0% decline from the $14.6 tln prior cycle-high in Q3 of 2008. Before this cycle, outright drops in liabilities were rare, as analysts last saw a quarterly liability decline in Q1 of 1983 with a 1.9% drop. Before that analysts saw a drop in Q1 of 1975 of 0.5%.