Pragmatic Capitalism

Capital for Living a More Practical Life

Fred Graph of Networth/Disposable Income

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What do you make of this FRED graphic (consumer networth/disposable income)?

I take that this suggests disposable income (and wages) will rise going forward though we could have another networth reversion at some point. (That said, I don’t know what is mispriced at this moment – high yield bonds, housing or equity) Any comments if this is interesting or just more noise?

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Posted on 06/03/2016 4:11 PM
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Hi DM,

Hard to glean too much from that chart because the DI data is pretty linear whereas the net worth data is extremely volatile. If anything, I’d argue that this chart says that asset prices are high and perhaps unsustainably high. But that’s a bit of a generalization.

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Cullen Roche Posted by Cullen Roche
Answered on 06/05/2016 2:29 PM