Torsten Slok presents this graph, and writes “The underside line is that the tailwind to client spending for householders and fairness homeowners is important, particularly when mixed with record-high money flows from fastened earnings.”
Supply: Torsten Slok/Apollo, 19 July 2024.
This made me ponder whether we’ve seen NBER peaks at quarters the place family web value has been rising. The family web value collection is comparatively quick, so I take advantage of family and nonprofit web value, deflated by the consumption deflator.
Determine 1: Actual family and nonprofit web value, in logs normalized to NBER enterprise cycle peak. Newest cycle (daring black) assumes peak at 2024Q1. Supply: Fed Move of Funds, BEA through FRED, NBER, and creator’s calculations.
Of the earlier 5 recessions, actual family web value has been reducing into the NBER peak 4 instances. The only real exception was the recession related to the 2020 pandemic. By means of distinction, in 2024Q1, actual web value elevated by 10% (q/q AR).
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