Wednesday, March 29, 2006

Happy Days Are Here Again

At the peak of the Internet boom in 1999 the market research firm TNS Financial Services reported that there were 7.1 million American families (about 8%) with net worth more than $1 million. After the Internet bubble burst, the millionaire households dropped steadily to 5.5 million by 2002. Then, however, the Bush tax cuts stimulated the economy and the ranks of millionaire households rose to 6.2 million in 2003 and 8.2 million in 2004.

The 2005 results were released today and the good times continue to roll. There are now 8.9 million American households (about 10%) with net worth more than $1 million, and the million bucks does not include equity in their homes or in their individual retirement accounts. Widespread American prosperity is the wonder of the financial world.

The millionaire households had an average net worth, excluding principal residence, of nearly $2.2 million, of which more than $1.4 million was in liquid assets. The survey counted some tax-deferred retirement savings but did not include individual retirement accounts in the liquid assets. Half of the heads of millionaire households were 58 or older and 45 percent were retired.

It is interesting and instructive to look at the distribution of wealth around the country. More millionaires live in California than anywhere else in the United States. Los Angeles County, home to 262,800 millionaires, is the jewel in the crown of the country's personal fortunes.

Two other SoCal counties rank in third and fifth place respectively on the list, boasting 113,299 millionaires in Orange County and 100,030 in San Diego County. Up North, Santa Clara County is home to a further 75,371 millionaires, according to the survey. The four California Counties add up to 551 thousand millionaire families, and that does not include such famously rich Counties such as Marin and San Francisco.

Elsewhere, the second richest region of America after Los Angeles is Cook County, Illinois with 167,873 millionaires. Others in the top ten are Maricopa County, Arizona with 106,210; Harris County, Texas (96,593); Nassau, New York (78,816); Palm Beach, Florida (69,871); and Middlesex, Mass. (67,552).

Over 50 percent of the millionaires surveyed said they had become more conservative in their investment approach over the past year. Still, seventy percent of the households owned stocks and bonds, and 68 percent owned mutual funds. Generally, their wealth is the result of long-term accumulation.

The lefty response to such good news is the usual canard about the rich getting richer at the expense of the poor. Of course, that is economic nonsense. Even the poor in America are doing better than ever before, and the ranks of the poor are decreasing. The latest US Census bureau report that takes government handouts into account in calculating income finds that the poor currently number only 5% of the people in America.

There are now twice as many millionaire families as poor families. What a country!


Anonymous Anonymous said...


Hope you are doing ok!!!!


7:38 PM  
Blogger Ralph said...


Good news never sells.

8:33 PM  
Anonymous Anonymous said...

U.S. National Debt: $9 trillion
Tax Cuts: Whether measured in absolute terms or as a percentage of income, middle-income households claim little in the way of capital gains and dividend income on their tax returns, and therefore benefit little from reductions in the dividend and capital gains tax rates. These tax cuts represent a significant loss of revenue for the federal government, with most of this money flowing to a modest number of very wealthy households.
Survey of Consumer Finances: Average family income drops 2.3%
Minimum wage: Hasn't increased in 8 years, while gas/heating prices are up.
Not good news

7:54 AM  
Blogger Bill Lama said...

You are wrong in so many ways:

US GDP: $13T, debt $9T.... no problem, especially at today's interest rates, an economic triumph coupled with low unemployment and low taxes. What percentage is your debt?

Income tax cuts helped everyone. Tens of thousands actually fell off the list of taxpayers and barely 50% now pay ANY federal income tax. I shudder at the thought of that percent of freeloaders exceeding 50%, when socialism could take over.

Capital gains and dividend tax cuts are not needed by the nearly 50% who pay no federal income tax. But those cuts do actually INCREASE revenues to government as Laffer showed and as has been true this time and every time it is tried. Learn some economics please.

Latest data on family income show a slight increase, but after tax income is up even more due to the tax cuts. Prosperity is up even more due to low prices.

Minimum wages are a bad idea and only fuel unemployment among youth. Check out Europe.

Energy prices have virtually nothing to do with government. Hawaii just tried to cap gasoline prices and gave up after a few months. Drilling in Alaska and the Gulf of Mexico would help in the long term but Dems oppose that. Nuclear power could help a lot but environmentalists oppose that in spite of their love of France that nuclear power behemoth.

Try again.

1:33 PM  

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