Fed says 55 percent of homes owned stock in 2001
Associated Press
WASHINGTON — Slightly more than half of U.S. households owned stock in 2001, compared with about a third only a decade earlier as the Wall Street boom of the 1990s pushed stock ownership to record levels.
The big rise in stock prices plus the longest economic expansion in history helped to boost family balance sheets, the Federal Reserve reported last week in the government's most extensive look at wealth in the country.
The typical family's net worth — the difference between household assets and liabilities — rose to $86,100 in 2001, a gain of 10.3 percent from 1998 after removing the effects of inflation.
Family incomes were up as well in 2001, with the median family, the midpoint for all families, earning $39,900, a gain of 9.6 percent from 1998.
In both the case of net worth and incomes, the richer did far better than those at the bottom of the income scale, a trend that has been under way for some time.
By net worth, the typical family in the bottom 20 percent of income distribution saw its net worth rise by 25.4 percent to $7,900. By contrast, the typical family in the highest 10 percent of income levels saw its net worth increase by 69.3 percent to $833,600.
Stock prices peaked in the spring of 2000, and since then investors have suffered three straight losing years on Wall Street, something that last happened at the end of the Great Depression in the 1930s.
The Fed survey was taken from May through December of 2001, so it does not capture the high point for stock portfolios.
The survey showed that the percentage of U.S. families with stock holdings hit 51.9 percent in 2001, the first time that more than half of households owned stocks, either directly or indirectly through their pension funds.
The percent of stock ownership was 48.9 percent of families during the last Fed survey in 1998 and 36.7 percent in 1992.
While the 1920s had a soaring market that crashed in 1929, economic historians have said that the number of families owning stock never topped 10 percent during that boom period.
