14% Of Americans Have Negative Wealth

Tyler Durden's picture

According to the New York Federal Reserve, 14% of the U.S. population lives in households that have “negative” wealth. In other words, these are households that have more debts piled up than assets, which puts their net worth in minus territory.

But what does a negative wealth household look like?

In the following chart, VisualCapitalist's Jeff Desjardins compares the data on negative wealth households with the data on their positive counterparts. There are some obvious and stark contrasts...

 

Courtesy of: Visual Capitalist

Households that are deep in the red have the majority of their wealth in the family car – automobiles make up 45% of the value of their total assets. Housing makes up 20% of their assets by value.

For positive wealth households, it is the reverse: 40% of wealth is in the home, and 15% in vehicles.

The composition of debt is also very telling. Negative wealth households have a whopping 47% of debt in student loans, while positive houses have just 6%.

Comment viewing options

Select your preferred way to display the comments and click "Save settings" to activate your changes.
Paul John Smith's picture

This number is too low.

Boris Alatovkrap's picture

Someone is must pay interest on fiat money that is create from nothing but is bear interest every year.

Boris Badenov's picture

OMG, that's the Smartest thing anyone has ever said.

Interest is the Killer, Alice.

https://www.youtube.com/watch?v=IlEi85pVegk

InsaneBane's picture

“We are BORN with equal, natural rights. These are not GRANTED by any kind of ruler, be it a constitution, a government or an international body.”

Their is a difference between common law and UCC law..
He who fails to assert his rights, has none

Aristotle of Greece's picture
Aristotle of Greece (not verified) InsaneBane Aug 6, 2016 9:25 PM

The almighty dollar replaced the Almighty God, and voila! Consequences never fail. http://wp.me/p4OZ4v-2hl

zeronetwork's picture

Target is 100% population under water so no one can take a breath of freedom.

Déjà view's picture

Additional $155,000 national debt and $15,000 Tejas state debt = $170,000 per household additional negative equity, would bring perhaps 90-95% Tejas households underwater...

http://www.justfacts.com/nationaldebt.asp

JamesBond's picture

Seems to be a significant diffeence between mean age of the groups.  The old normal - get a college degree paid for in cash, take on mortgage debt (probably arond $75,000) , buy a car with cash or a loan (probably around $13,000), get a good paying job, work hard and pay it all off, collect your 5% interest on savings, and retire.  The new normal - get a college degree at inflated prices via a government loan that can not be discharged, graduate into a job market with a waiter job, live with parents or friends, get a car loan (probably around $25,000) that in the future may not be dischargeable, work part time for awhile, complete a liar loan application and secure an ALT mortgage (probably around $200,000) and then watch it all go up in smoke.

 

Age.  It's the new bit biatch.  

 

jb

Déjà view's picture

CORRECTION

Tejas state/local gov't debt is per head...household of 4 = $60,000 + $155,000 national gov't debt share per household = $215,000...makes more like 95% of all Tejas households.

http://www.texaspolicy.com/blog/detail/15000-owed-by-every-texan-for-sta...

PT's picture

A little perspective:

Sir Robert Maxwell was the third richest man*, until it turned out he was really up to his eyeballs in debt.
Alan Bond was a billionaire ... until suddenly he was billions in debt.

"The magazine says this guy is worth $300 million.  What they mean is that he probably has Assets of $300 million, Liabilities of $290 million, so he's really only Nett $10 million ... on a good day." - paraphrasing an Accountant at a Contractor's course.

 

 

 

* in the world?  in England?  I can't remember.

Handful of Dust's picture

Widespread poverty and heightened racial tensions are the result of the magician's Robust Recovery!

 

Legacy, Bitches!!

Escrava Isaura's picture

Not to worry. Very soon these Goyim will assert their right by going after Putin while the smart class will be going after Iran’s oil.

 

Then, China will panic and fold. Buys US treasuries galore. Sebastian Mallaby will then say: “US bond market has more money (and debt) than God.”

 

CheapBastard's picture

"If you want to keep your wealth, you can keep your wealth. I promise!"

 

 

MissCellany's picture

And the powers that be are aiming to jack up that 14% of households in "negative wealth" all the way to 99%...

..."negative interest rates" (NIRP) are an outstanding tool for the purpose...

...so those few who struggle their way out of debt still get royally screwed...and forget about building wealth, savings, retirement funds...

...WASF.

HedgeJunkie's picture

GOLD, BEECHES!!

Physically held with proper defenses thereof.

Offthebeach's picture

American proles have thrown in the towel in raising new tax slaves, and have turned to Oxytocin and Heroin.

Luckily, it is cheap to outsourse new tax donkeys, have the young raised in feeder farm countries and brought in when able to mow laws, clean house. Way way cheaper. Plus so ignorant, no pesky labor questions.

Lady Jessica's picture

Um, if the proles are abusing oxytocin then things are really really getting grim.

GunnerySgtHartman's picture

Oxytocin?  LOL, everyone's trying to have a baby?  Methinks you mean OxyContin.

JRobby's picture

Cash interest paid to a bank on a risk-less "loan" created out of thin air.

Believe the student loan lie, you die poor. Same as the housing "bubble" when we were told we could afford a house that was 10X annual incomes.

Boris Badenov's picture

Yes, even when the debt is fully paid off, and money is subtracted from the money supply, the Interest Lives on in somebody's pocket. 

TradingIsLifeBrah's picture
TradingIsLifeBrah (not verified) Paul John Smith Aug 6, 2016 11:06 PM

All of their net worth is in the paper value of their home, notice a problem?

QEpp's picture

Number is too low.  Student debt alone should put most of the millenials in the negative category.

Bay Area Guy's picture

Paul John Smith, that number will greatly increase when the housing bubble bursts.

Eddie Baby's picture

It looks like a good news article.

navy62802's picture

94.3 Million people are not in the labor force. The current US population is 318.9 Million people. That equates to 29.5% who are not even in the labor force. How does this 29.5% of Americans maintain a positive net worth? This is a percentage that far exceeds the 14% cited in the original posting.

rejected's picture

By not having a mortgage, car loans or debt cards and no job their net worth would be 0. This is positive when compared to the debt slaves working every day to pay this or that.

Mustafa Kemal's picture

It feels a little like keeping your money in banks.

ebworthen's picture

There is no such thing as debt, just ask the banks/corporations/insurers, and the FED and Treasury.

Money is free, apparently; just not for us Serfs.

p.s. - the student debt is un-payable.

 

pitz's picture

Well elderly retirees aren't in the labour force, but many own significant assets.  Pretty simple explanation.

ZD1's picture

Record numbers of illegal and legal immigrants are in the U.S. labor force because of open borders and the Obama regime's refusal to enforce immigration laws.

 

The number of immigrants employed in the United States reached another monthly record high in July, according data released Friday by the Bureau of Labor Statistics.

 

The BLS reports that 25,984,000 foreign-born people had a job in the U.S. last month, up 133,000 compared to the previous record set in June.

 

 

http://www.breitbart.com/big-government/2016/08/05/record-25984000-immig...

Antifaschistische's picture

LOL...are they using the "appraisal" values in Texas to determine "underwater"?   no one here is selling their home anywhere close to appriasal values.

Boris Badenov's picture

So, repeal the Bankcruptcy REFORM Act of 2005 and All is Well.

Escrava Isaura's picture

Great point.

Talking about the Republicans screwing the average American while few years later rescuing the wealthy Americans.

 

Antifaschistische's picture

thats a piece of the puzzle...a complete revolt against property taxes....and I DO revolt in ways I can't mention here.

I think the Property Tax Appeal Board members should be the target of MUCH MUCH publicity

GunnerySgtHartman's picture

I'd love to see a total and complete revolt against property taxes.  Talk about an antiquated and absolutely confiscatory form of taxation, that's it.  Where do we sign up for such a revolt???

Boris Badenov's picture

Repealing the BK Reform Act 2015 would make Student Loans dischargeable in bankruptcy, it has noting to do with ad valorum taxes.

DontWorry's picture

Who here trusts anything the Fed says?

 

Bear's picture

I trust that they will lie about most everything

Mustafa Kemal's picture

Its almost perfectly reliable.

de3de8's picture

Your right, likely much worse. I also can't help but think that Fed laying the ground to forgive student debt

ZD1's picture

Meanwhile Obama's FSA have EBT cards, Obamaphones, Section 8 subsidized housing, "free" cable and internet, "free" Obamacare, "free" education, subsidized electricity and gas heat in the winter, etc., etc.

 

It's all freeeeeeeeeeeee!

HRH of Aquitaine's picture
HRH of Aquitaine (not verified) ZD1 Aug 6, 2016 11:07 PM

Except that people like me pay for the F$A to get free shit. I have at least $10 a month of fees and BS on my cable / internet bill. Another $10 a month on my phone. It goes on and on and on. Shit even my utility bill for electric and natural gas siphons cash from people like me to give away free power.

Nothing in life is free. If you are getting free $hit it is because you are slumming off the backs of people that actually pay bills and contribute.

de3de8's picture

I used to say the same thing, but it's really financed by piling on debt. In fact if they dinged the taxpayer every time they wanted another FS program they would get push back they don't see now. Alas, will never happen unless and until we have a balanced budget amendment and responsible representatives. Sadly not in my lifetime!

401K of Dooom's picture

You forgot to take into account type of degree, occupation and where in the country they live.  That would give you a better idea of what is going on.  New England, New York, the Mid-Atlantic states and the West Coast are eating themselves alive.  People can only live there is they already have six-figure salaries or are living under the table. 

brushhog's picture

Complete nonsense, you can buy a 4 bedroom house for 75K in many parts of New York.  Plenty of poor and middle class all over New England, NY, and the mid-atlantic states. You need to get out more.

rejected's picture

A mortgage is not an asset,,, it's a liability.

A car loan is not an asset,,, it's a liability. 

Second car loan is stupid,,,, it's also a liability.

I would estimate > 80% of the population is underwater using market based values, and not the banker fantasy based values.

Croesus's picture

@ Rejected:

They lie about their data all the time; I wouldn't expect they'd suddenly decide to be truthful, especially not in an election year. 

I would definitely agree that it's 80%+ underwater. 

 

HRH of Aquitaine's picture
HRH of Aquitaine (not verified) rejected Aug 6, 2016 11:09 PM

Brilliant. Even Federal Reserve Notes are not assets. They are debt instruments. Accepted, for now.

Spungo's picture

20% of the poor people are single mothers? Makes sense.

Mazzy's picture

They should've made better pairing choices.

Welcome to 2016 where there are too many backstops for women choosing to become baby-mamas for thugs and losers.

Take away the backstops, payouts, and safety-hammocks, and women will have little choice but to make better choices or actually have to deal with the consequences (which seems to be a lost concept in this society).