Sometimes media criticism can be easy–especially when an article is based around a shaky premise that is undermined by the article itself.
Friday’s USA Today front page (3/29/13) declared, “We’re Feeling Rich Again.” A subhead, pointing to a related sidebar article, recommends that we should “show this bull some love.” That doesn’t mean what you might think.
But the right question to ask is who precisely “we” might be.
Reporter Paul Davidson didn’t have many doubts, at least in the lead:
The stock market’s record-setting rally has helped U.S. households recover all of the wealth they lost in the Great Recession, prompting many Americans to open their wallets and shrug off a recent payroll tax hike.
So “U.S. households”–hey, that’s sort of like almost all of us, right?!
The piece tells us the Standard & Poor’s index–a “closely watched barometer of the stock market”–broke a record, just like the Dow. Home prices are coming back–up 9 percent from their low point.
That doesn’t sound terribly impressive, and you have to read to the second-to-last graph to get a dose of reality:
Although most of the increase in household wealth can be traced to climbing stock values, only about half of U.S. households own stocks, Zandi says. Only about 10 percent have significant holdings, says Beata Caranci, deputy chief economist at TD Economics.
So household wealth is on the rebound–but mostly because of the stock market. Which means it means next to nothing to the vast majority of us.
But still… “we’re” feeling rich, right?!
(For an earlier version of this, see Newsweek‘s 1999 cover “Everyone’s Getting Rich, But Me,” which assured readers that “wealth is increasingly spread out as businesses give workers more of a stake. And as everybody starts to pick up his own dot.com business plan, that picks up the pace of innovation.” That bubble was about to burst.)
“We’re Feeling Rich Again”
This is the only sort of “inclusiveness” the corpress has any interest in, isn’t it?
Oh we are being shown ‘The love of that Bull” alright, I think we just stepped in another Bulls Nest on the side of the road.
In what world do these reporters live? The households that are the top 1% by income own about 33% of all stocks, the next 4% own a similar percentage and the next 5% own about 12 – 14%. So, overall, the top 10% of households (again by income) own 75 – 80% of all stocks – and this is both direct as well as indirect, i.e through pension plans, 401(k)s, IRAs, etc.
Now it is true that this top 5 – 10% do account for a huge percentage of consumer spending – after all, they have 30 – 35%+ of total income – but how is that a “we’re ALL feeling rich” story???
I recall Allan Greenspan saying we lost $17 Trillion, then last week I think someone on NBR said “we” were back to within $1.3 trillion of what “we” had lost. I suspect at least $4 trillion of that moved from the lower 4 quintiles (80%) to a tiny part of the top quintile (maybe only half, or less, of the top 20%). I still think at least half of the notional value is pure b/s, though, preferring John Bogle’s estimate of how much is solid investments to the 4 or 5 times as much that is speculation. Perhaps that is why they want such favorable tax rates, if they had to pay the tax rates on the notional value that people do on the money they earn in the top brackets, there might not be enough “money” in the world to do so.
Just another feel good piece with the truth buried within the text. So they can’t be called a liar by anyone. They just didn’t boldly tell the truth.
You have that straight Mr. Hart.
The economy sucks and it is getting worse.Real unemployment is at least 17%.90 million Americans are not working.The president said this week we must help poor people to buy homes.That that is the answer to an invigorated economy.He also wants to(wait for it)raise taxes on the wealthy again.He also is leaning toward another stimulus.He isn’t even a one trick pony anymore.He is plain and simply a jackass.
Good to have you back in the mix again, dood–we all missed your keen insights, like the one above. I know Jim N. was wondering about you . . . .
Thanks Tim…We need to liven up this lackluster bunch with some passion