The Growing Gap in Wealth Inequality

Paul FennerBusiness & Economics

As this Business Insider article points out that extrapolating the future based upon past trends is never a sure-fire answer.  The chart below points out the growing disconnect between those that have the most wealth and those that do not.  Stagnant wage growth especially here in the U.S. has not helped the masses while those of you participating in the equity markets over the past 6 years have likely seen a significant increase in your net wealth.

The WSJ takes a look at how “the advance of wealthy households, while middle- and lower-income Americans struggle, is reshaping markets for everything from housing to clothing to beer.”

  • “It’s a tale of two economies,” said Glenn Kelman, chief executive of Redfin, a real-estate brokerage in Seattle that operates in 25 states. “There is a high-end market that is absolutely booming. And then there’s everyone in the middle class. They don’t have much hope of wage growth.”

See also this Atlantic piece on the shrinking income of young Americans.  With lower wages come lower savings rates, the ability to buy a first home, or new car and the trickle down effect goes from there.