Bloomberg has reported that JPMorgan Chase estimates that the collective net worth of Americans has fallen by at least $5 trillion since the beginning of 2022, and the number may reach $9 trillion by the end of the year.
This data comes following the Federal Reserve reported that Americans’ net wealth rose at an astounding rate of an additional $38.5 trillion from the beginning of 2020 until the end of last year, even in light of the challenges faced by families and companies from the scourge of “Corona”. This raised the collective net wealth of households to a record high of $142 trillion.
“wealth shock”
So far, the richest Americans are bearing the brunt, with billionaires’ fortunes down nearly $800 billion, with sharp losses in stocks, cryptocurrencies and other financial assets.
But high interest rates are also beginning to destabilize the housing market, where the bulk of the wealth of middle- and working-class families is located. Over the past decade, the robust real estate market has added $18 trillion in market value to owner-occupied home valuations. Economists at JPMorgan described it as a “wealth shock” that is set to derail growth next year.
According to the report, the Bloomberg Billionaires Index, a daily measure of the wealth of the world’s 500 richest people, has fallen by $1.6 trillion since its peak last November. The Americans led this decline with a loss of 797 billion dollars.
Tesla and Amazon top the list
Perhaps the richest person in the world, and the owner of “Tesla” Elon Musk, was at the top of the list, as his fortune bled 139.1 billion dollars, or 41% of its value since that period, following it exceeded 340 billion dollars for a short time.
Amazon founder Jeff Bezos, the world’s second-richest person, also lost $82.7 billion, or 39% of his peak wealth.
And while wealth losses among the richest 0.001% of the population reduce inequality, that will be uncomfortable for most people who are constantly worried regarding widening disparities in the United States. “In a relative sense, it will reduce inequality a little bit, but in absolute terms, everyone will suffer,” said Rina Agarwal, director of the Psaros Center for Financial Markets and Policy at Georgetown University. Considering that the falling markets will create problems for the broader economy, and that there was a need for some correction, but this is a very huge correction, and it does not stop. «Bloomberg»