It highlights Herbstein’s article “Balance of Payments,” edited by David R. Henderson on March 7, 2025. A concise encyclopedia of economics. That led to lively discussion in the comments section.
Frequent Comer Warrenplatz notes that net international investment in the US as a percentage of GDP has been downhill since around 2007 and is now at minus 90%.
It may sound scary, and it made me wonder.
But for most Americans, it’s not how much foreign investment is, but rather how much their net worth is and how it has changed.
So I was relieved to see the THHOS data.
The Fred site of St. Louis Fed shows our household’s current net worth in dollars from the fourth quarter of 1987 to the fourth quarter of 2024. It rose from $17,426 trillion in 1987 to $160,345 trillion in 2024. Therefore, household net worth over these 37 years increased by 237%.
Of course, the number of households has also increased. According to Fred, this increased from 89.479 million in 1987 to 13,216 million in 2024.
That is, Avenge increased its family wealth in 2024 from $532,426 in 1987 to $1,217,504 in 2024, up 129%.
Short Journal Reference by CommeroPlatts: How about 2007-2024?
In 2007, its household net worth was $65,754 trillion. $2024 is $98,702 trillion. Therefore, household net worth increased by 62.5%.
The number of households increased from 116011 million in 2007 to 13216 million in 2024.
Therefore, household net worth per household increased by 43%, up from $850,799 in 2007 to $1,217,504 in 2024.
Note that these are mean and not median. Median household net worth at each point in time is below average.
But given that the problem is the situation across the US, whatrs here is average. Revenge states that America is becoming wealthy (and perhaps in part?) increasing foreign investment.
