shine trader live reports:
After years of decline, the wealth share of the middle class in the whole American society has been lower than that of the top 1% of the rich in the United States.
In June, the total assets of middle-class families in the United States fell to 26.6%, the lowest level in 30 years by the Federal Reserve. In contrast, the proportion of the total assets of the super rich surpassed the middle class for the first time, reaching 27%.
From these data, we can see that the financial security of the middle class in the United States is slowly declining, which has exacerbated the dissatisfaction of voters in recent years. Although the government has provided trillions of dollars in relief, this situation is continuing during the COVID-19 pandemic.
Although there are different opinions on the meaning of “middle class”, many economists still define this group by income. According to the data of the US Census Bureau, the annual income of 77.5 million U.S. households in the middle 60% of the total is about 27000 to 141000 US dollars (about 174000 yuan to 909000 yuan).
In a generation, the share of the American middle class in real estate, stocks and private enterprises has fallen sharply. Affected by this, their lives become more unstable. Once they lose their jobs, they can rely on less and less financial reserves.
About 1.3 million households are at the top of the income pyramid, accounting for only 1%. Their annual income is roughly more than $500000, while the total number of families in the United States is close to $130 million. The concentration of wealth in the hands of a small number of people is the core issue of some major political struggles in the United States.
US President Biden is seeking to propose a $3.5 trillion package to Congress to support working-class and middle-class families. The plan includes assistance in child care, education and health care, as well as tax increases for high-income earners.
Nathan sheets, the newly appointed chief economist of Citigroup Inc., said: “if the economic system cannot serve the vast majority of people, it will eventually lose political support. This is driving many economic reforms proposed by the Biden administration.”
Fed data show that in the past 30 years, 10% of U.S. wealth has gone to the 20% with the highest income, who currently own 70% of the total U.S. wealth. Economically strapped workers have driven support for former president trump and the Republican Party’s shift to populism.
A generation ago, the American middle class held more than 44% of real estate assets in the United States, but now it has dropped to 38%. COVID-19 has led to skyrocketing housing prices, so that most people who own real estate are the first to benefit. At the same time, the soaring rent has hurt those who can’t afford a house. The cycle of self-sufficiency creates more wealth for the rich.
Another reason for the decline in the wealth of the middle class is that their proportion of unsecured consumer debt is too large and increasing, which is usually accompanied by higher interest rates.
Reprint indicated source：Shine Trader Limited Live information