[Peace-discuss] How are your investments doing?

[Szoke, Ron]

Here’s the really bad news: Only half of Americans own stocks
WSJ   Feb 10, 2018
And the wealthiest among us own 81% of their value

By ALESSANDRA MALITO<http://www.marketwatch.com/topics/journalists/alessandra-malito>

For more than a year, investors have been touting strong returns from a raging bull market. At least, until this week.
After a week of intense market volatility, with the Dow Jones Industrial Average DJIA, +1.38%<https://www.marketwatch.com/investing/index/djia?mod=MW_story_quote> falling 10% since last month’s peak, investors are left wondering: What will this do to my 401(k) plan? Should I call my broker? What will happen to my retirement funds?
Spare a thought for all those Americans who have no investments in the stock market. Why? There are, unfortunately, quite a lot of them.
Just over half (54%) of Americans own stocks, according to a 2017 Gallup report<http://news.gallup.com/poll/211052/stock-ownership-down-among-older-higher-income.aspx>. That includes individual stocks, 401(k) plans, shares in an equity mutual fund or an IRA account. What’s more, two-thirds of Americans do not participate or have access to a 401(k) plan, according to Census Bureau researchers<https://www.marketwatch.com/story/the-amount-of-americans-not-saving-for-retirement-is-even-worse-than-you-thought-2017-02-21>.

In fact, the wealthiest Americans possess more than 80% of the aggregate value of stocks. “Despite the fact that 46% of households owned stock shares either directly or indirectly through mutual funds, trusts, or various pension accounts, the richest 10% of households accounted for 81% of the total value of these stocks, though less than its 91% share of directly owned stocks 22 and mutual funds,” Edward Wolff, professor of economics at New York University, wrote in his 2017 paper<http://www.marineconomicconsulting.com/w20733.pdf> “Household Wealth Trends in the United States.”

“Housing, liquid assets, and pension assets accounted for 87% of the total assets of the middle class,” he added. “The remainder was about evenly split among nonhome real estate, business equity, and various financial securities and corporate stock. Stocks directly or indirectly owned amounted to only 10% of their total assets.”
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Upshot (to me):
The stock market is not the economy.
In the shorter run, its ups & downs have little or no significant effect on middle-class people.
(The great majority of Americans think they are “middle class.”)
~~ Ron

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