business news in context, analysis with attitude

The US Federal Reserve’s Survey of Consumer Finances suggests that the boom economy of the 1990s was experienced by all American families, the gap between rich and poor also expanded, according to a report in The Washington Post this morning.

Among the statistics cited:

  • The median income among the poorest families jumped 14.4 percent between 1997 and 2000. The median for black families rose more than twice as fast as the median increase for all American families, which was 9.6 percent.

  • The median net worth of most families rose 10.4 percent, to $86,100, over the three-year survey period. Among blacks it rose 13.1 percent, to $19,000 from $16,800.

  • The median among those in the wealthiest 10 percent leapt to $833,600 from $492,400, while the mean soared to $2.26 million, from $1.68 million three years before. These families' median income was up 19.3 percent, to $169,600, during the same period.

  • The median income for the poorest 20 percent of families was only $10,300, up from $9,000 three years earlier, and the net worth of these families rose only to $7,900, from $6,300. The median income for black families was $25,500, compared with $21,200 in 1997.

  • More than 50 percent of American families owned stock during the decade, either directly or indirectly, the highest level ever. In addition, while families’ debt grew rapidly during the period, so did their assets.

KC's View:
It was all that wealth being absorbed by those (now former) Kmart executives that probably threw off the statistics…

Just kidding.

Much has changed since the halcyon days of a boom economy…but these figures remain interesting nonetheless. It’ll be interesting to see, in just a few years, how differently the rich and poor weather the current economy.