The U.S. is richer than ever

Yesterday the Fed released its estimate of the balance sheet of U.S. households as of the end of last year. Collectively, our net worth reached a new high in nominal, real, and per capita terms. We can complain all day about the fact that we are living in the weakest recovery ever, and things could and should be a lot better, but it is still the case that today we are better off than ever before. (The stock market has recovered virtually all of its losses year to date, so the significance of the numbers you see here hasn't changed.)

As of Dec. 31, 2015, the net worth of U.S. households (including that of Non-Profit Organizations, which presumably exist for the benefit of all) reached a staggering $86.7 trillion. To put that in perspective, it's about one-third more than the value of all global equity markets, which were worth $64.6 trillion at the end of last year according to Bloomberg.

On a real, per capita basis, the net worth of the average person living in the U.S. reached a record $270,000. This measure of wealth has been rising, on average, about 2.4% per year since records were first kept beginning in 1951. There's nothing unusual going on: life in the U.S. has been getting better and better for generations. If you're hungry for more details of the steady march of progress, check out Human Progress, a worthwhile project of Cato, my favorite think-tank.

And even if it were the case that the entirety of the value of stocks, bonds, deposits and real estate included in these statistics were owned by a handful of people, we all enjoy their benefits. These assets are what provide jobs and the wherewithal to run and maintain our economy.

This ongoing accumulation of wealth is not a house of cards built on a bulging debt bubble either, regardless of what you might hear from the scaremongers. On the contrary, the typical household has undergone a significant deleveraging since the onset of the Great Recession in 2008. Household liabilities today are the same as they were in early 2008 (about $14.5 trillion), but financial assets have increased by one-third, thanks to significant gains in savings deposits, bonds, and equities. Since early 2008, the value of households' real estate holdings has increased by a relatively modest 8%.