{"id":57449,"date":"2021-04-13T06:26:51","date_gmt":"2021-04-13T11:26:51","guid":{"rendered":"https:\/\/olduvai.ca\/?p=57449"},"modified":"2021-04-13T06:26:51","modified_gmt":"2021-04-13T11:26:51","slug":"i-now-track-the-most-important-measure-of-the-feds-economy-the-wealth-effect-and-how-it-impacts-americans-individually","status":"publish","type":"post","link":"https:\/\/olduvai.ca\/?p=57449","title":{"rendered":"I Now Track the Most Important Measure of the Fed\u2019s Economy: the \u201cWealth Effect\u201d and How it Impacts Americans Individually"},"content":{"rendered":"
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I Now Track the Most Important Measure of the Fed\u2019s Economy: the \u201cWealth Effect\u201d and How it Impacts Americans Individually<\/a><\/h3>\n<\/header>\n
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The Fed provides the data quarterly, I dissect it at the stunning per-capita level.<\/strong><\/p>\n

The Federal Reserve is pursuing monetary policies that are explicitly designed to inflate asset prices. The rationalization is that ballooning asset prices will create the \u201cwealth effect.\u201d This is a concept Janet Yellen, when she was still president of the San Francisco Fed, propagated in a paper. In 2010, Fed Chair Ben Bernanke explained the wealth effect to the American people in a Washington Post editorial. And in early 2020, Fed Chair Jerome Powell pushed the wealth effect all the way to miracle levels.<\/p>\n

Today we will see the per-capita progress of that wealth effect \u2013 what it means and what it accomplishes \u2013 based on the Fed\u2019s wealth distribution data<\/a>through Q4 2020, and based on Census Bureau estimates for the US population over the years. Here are some key results. At the end of 2020, the per-capita wealth (assets minus debts) of:<\/p>\n