Finance and Economics Discussion Series: Accessible versions of figures for 2019-017

Introducing the Distributional Financial Accounts of the United States

Accessible version of figures


Figure 1: Predicted Measures of Corporate Equities/Mutual Funds and Mortgages

Panel A: The levels of corporate equities and mutual funds by wealth group over time for the quarterly reconciled SCF balance sheets. The chart covers the period 1989Q3-2018Q4 and shows the holdings of each wealth group (top 1%, next 9%, next 40%, and bottom 50%) stacked on top of each other. The chart also shows the B.101.h total as a point of comparison. The total reconciled SCF level of corporate equity and mutual fund holdings across wealth groups increases from under $5 trillion in 1990 to around $23 trillion in 2018Q4. The total is volatile, with notable downturns around 2001 and 2006-2009 and in the most recent quarter (2018Q4). In general, the total matches the B.101.h total fairly closely. The shaded regions show that most of this total is held by the top 1% and the next 9%. The remaining holdings are largely owned by the next 40% ($3 trillion in 2018Q4), while the bottom 50% has very low holdings throughout the period covered by the panel ($200 billion in 2018Q4).

Panel B: The levels of mortgage liabilities by wealth group over time for the quarterly reconciled SCF balance sheets. The chart covers the period 1989Q3-2018Q4 and shows the liabilities of each wealth group (top 1%, next 9%, next 40%, and bottom 50%) stacked on top of each other. The chart also shows the B.101.h total as a point of comparison. The total SCF level of mortgage liabilities across wealth groups increases from around $2 trillion in 1989Q3 to around $10 trillion in 2018Q4. The total level, and each wealth group's subtotal, is increasing from the beginning of the series to 2007, with particularly rapid increases occurring in the period 2002-2007. The total decreases from 2007 to about 2014 and increases thereafter. The reconciled balance sheet totals follow the same contour as the B.101.h but are generally a few hundred billion lower. The shaded regions show that most of this total is held by the next 40% (about $4.5 trillion of the $10 trillion total in 2018Q4) and the bottom 50% (about $3 trillion in 2018Q4). The remaining holdings are largely owned by the next 9% wealth group ($2 trillion in 2018Q4), while the top 1% group has fairly low holdings throughout ($500 billion in 2018Q4).

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Figure 2: Net Worth by Wealth Percentile Group

Panel A: The levels of net worth by wealth group over time for the DFAs. The chart covers the period 1989Q3-2018Q4 and shows the net worth of each wealth group (top 1%, next 9%, next 40%, and bottom 50%) stacked on top of each other. The total level of net worth across the 4 wealth groups increases from about $20 trillion in 1989Q3 to around $100 trillion by 2018Q4, though with notable declines around 2001-2002 and 2006-2009 and a noticeable tick down in 2018Q4. Over time, the top 1%, next 9%, and next 40% groups hold roughly equal amounts of net worth (see the next panel for trends on these shares), while the bottom 50% groups has almost no net worth (around $1.5 trillion in 2018Q4).

Panel B: The shares of net worth by wealth group over time for the DFAs. The chart covers the period 1989Q3-2018Q4 and shows the shares of net worth of each wealth group (top 1%, next 9%, next 40%, and bottom 50%) stacked on top of each other, so that total across the groups is 100 by construction. Each of the top 3 wealth groups generally hold about 1/3 of net worth, with the bottom 50% share remaining close to 0 (between 1 and 4 percent typically). However, the shares do show clear trends, with the top 1% and top 10% (top 1% + next 9%) shares increasing steadily at the expense of the bottom 90%. For instance, the top 10% share increases from about 60 percent in 1989Q3 to roughly 70 percent in 2018Q4, with the top 1% share increasing from around 22 percent to around 30 percent, albeit with a visible tick down in 2018Q4. The next 40% group's share declines from 36 percent to about 29 percent. The share of the bottom 50%, after remaining small but fairly steady around 3-4 percent from 1990 to 2006, declines to near-0 during the Great Recession years and still has not fully recovered.

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Figure 3: Total Assets by Wealth Percentile Group

Panel A: The levels of total assets by wealth group over time for the DFAs. The chart covers the period 1989Q3-2018Q4 and shows the total assets of each wealth group (top 1%, next 9%, next 40%, and bottom 50%) stacked on top of each other. The total level of assets across the 4 wealth groups increases from around $23 trillion in 1989Q3 to about $113 trillion by 2018Q4, though with notable declines in 2006-2009 and in 2018Q4. The contours for the different wealth groups are similar, with the highest three wealth groups holding broadly similar amounts of wealth as each other over time (see the next panel for details on the shares) and the bottom 50% group holding only a few trillion of the total.

Panel B: The shares of total assets by wealth group over time for the DFAs. The chart covers the period 1989Q3-2018Q4 and shows the shares of total assets of each wealth group (top 1%, next 9%, next 40%, and bottom 50%) stacked on top of each other, so that total across the groups is 100 by construction. The top 1% share increases steadily over time from about 20 percent in 1989Q4 to about 27 percent in 2018Q4. The next 9% group’s share holds steady over time at about 35 percent, while the next 40% group's share declines noticeably from 37 percent to 30 percent. The bottom 50% share remains steady and low through 2009 at about 7.5-8.5 percent, after which it declines slightly to 5.5 - 6 percent.

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Figure 4: Total Liabilities by Wealth Percentile Group

Left Panel: The levels of total liabilities by wealth group over time for the DFAs. The chart covers the period 1989Q3-2018Q4 and shows the total liabilities of each wealth group (top 1%, next 9%, next 40%, and bottom 50%) stacked on top of each other. The total level of liabilities across the 4 wealth groups increases from around $3 trillion in 1989Q3 to about $15 trillion by 2018Q4, though with notable declines from 2008-2013. The contours for the different wealth groups are similar. The bottom two wealth groups (next 40% and bottom 50%) typically hold similar total liabilities, and these two groups dominate the total, with the next 9% group making up most of the remainder. For instance, in 2018Q4, the bottom 50% held $5.5 trillion in total liabilities, the next 40% held $6 trillion, while the next 9% held only $3 trillion and the top 1% held under $1 trillion.

Right Panel: The shares of total liabilities by wealth group over time for the DFAs. The chart covers the period 1989Q3-2018Q4 and shows the shares of total liabilities of each wealth group (top 1%, next 9%, next 40%, and bottom 50%) stacked on top of each other, so that total across the groups is 100 by construction. By and large, the shares do not show clear time trends, with the top 1% holding about 3-5 percent of total liabilities, followed by 15-18 percent for the next 9% , 40-50 percent for the next 40%, and 30-35 percent for the bottom 50%. The bottom 50% share is more volatile than the other groups' shares.

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Figure 5: Pension, Real Estate, Corporate Equity, and Noncorporate Business Equity by Wealth Percentile Group

Panel A: The shares of real estate assets by wealth group over time for the DFAs. The chart covers the period 1989Q3-2018Q4 and shows the shares of total assets of each wealth group (top 1%, next 9%, next 40%, and bottom 50%) stacked on top of each other, so that total across the groups is 100 by construction. The top 1% share increases steadily, but modestly, over time from about 8.5 percent in 1989Q3 to about 13.8 percent in 2018Q4. The next 9% group's share holds steady over time at about 30 percent, while the next 40% group's share declines from 49 percent to 42 percent. The bottom 50% share remains steady at 12-15 percent over time. The bottom 50% share is more volatile than the others, with notable increases in the mid 1990's and during the Great Recession years.

Panel B: The shares of pension assets by wealth group over time for the DFAs. The chart covers the period 1989Q3-2018Q4 and shows the shares of total pension assets of each wealth group (top 1%, next 9%, next 40%, and bottom 50%) stacked on top of each other, so that total across the groups is 100 by construction. Dramatic trends in these shares are not evident. The top 1% share holds roughly steady at 7-9 percent. The next 9% share increases from 39 percent in 1989Q3 to 46 percent in 2018Q4, while the next 40%'s share hovers around 45 percent. The bottom 50% share declines slightly from 4.5 to 2.6 percent.

Panel C: The shares of corporate equity by wealth group over time for the DFAs. The chart covers the period 1989Q3-2018Q4 and shows the shares of total corporate equity of each wealth group (top 1%, next 9%, next 40%, and bottom 50%) stacked on top of each other, so that total across the groups is 100 by construction. The top 1% share increases from 37 percent in 1989Q3 to 50 percent in 2018Q4. The next 9% share declines from 42 percent to 36 percent, on net, while the next 40% share declines from 19 percent to 13 percent. Finally, the bottom 50% share remains very low at around 0-2 percent. The top 1% share contracts noticeably relative to the other shares during times of turmoil (1991, 2001-2002 and 2007-2009, as well as a bit in the most recent quarter).

Panel D: The shares of noncorporate business equity by wealth group over time for the DFAs. The chart covers the period 1989Q3-2018Q4 and shows the shares of total noncorporate business equity of each wealth group (top 1%, next 9%, next 40%, and bottom 50%) stacked on top of each other, so that total across the groups is 100 by construction. The top 1% share increases from about 40 percent in 1989Q3 to 53 percent in 2018Q4. The next 9% share declines from 36 percent to 33 percent, on net, while the next 40% share declines from 20 percent to 13 percent. Finally, the bottom 50% share remains very low at around 0-2 percent.

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Figure 6: Wealth Concentration Measures from the DFAs and WID

Left Panel: DFA and WID wealth shares over time. The chart covers the period 1989Q3-2018Q4 and shows the shares of total wealth of each wealth group (top 1%, top 10%, next 40%, and bottom 50%) according to the DFAs and the WID, which runs only through 2014. In general, the two sources show similar levels and trends -- low and flat shares for the bottom 50% around 3-4 percent, declines for the next 40% from around 36 percent to around 29 percent, and increases for the top 10% (from around 60 percent to 70 percent) and top 1% (from around 23 to 30 percent). However, the WID shares for the top 10% and top 1% are generally higher than the DFAs, particularly for the top 1% in recent years. For instance, in 2014Q4, the last date covered by the WID, the DFAs show a 31 percent share for the top 1% versus a 37 percent share in the WID. Conversely, the WID shares for the next 40% and bottom 50% groups are consistently below those in the DFAs.

Right Panel: DFA and WID Gini coefficients over time. The chart covers the period 1989Q3-2018Q4 and plots Gini estimates using the DFAs and the WID. The WID series only runs through 2014Q4. Both time series show Gini increases of about 0.07 over the period covered. Additionally, both series show a particularly rapid increase between 2002 and about 2010. However, the WID series is always above the DFA series -- it starts at 0.78 and increases to 0.85, while the DFA Gini series starts at 0.75 and increases to 0.82. Finally, while both series show declines in recent years after peaking around 2010, the WID decline is sharper.

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Figure 7: Wealth Levels and Shares in the DFAs and SCF

Two Panels which repeat Figure 2. The only change is that now both figures show black dots for each series on SCF quarters, which occur every three years.

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Figure 8: Annual Change in Net Worth Shares for the Top 1 and 90-99th Percentiles

The four quarter moving average change in the net worth shares of the top 1% and next 9% wealth groups over time. The chart covers the period 1989Q3-2018Q4. Both series are volatile, with each ranging between -1 and 1 percentage points. The series are clearly negatively correlated, with each looking almost the mirror image of the other. The top 1% series is procyclical, decreasing during recessions and increasing during recoveries. The next 9% series shows the reverse pattern, increasing in recessions and then declining during recoveries. The top 1% series declines notably in 2018$, while the next 9% series increases by a smaller amount. Both series show the largest changes during the Great Recession.

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Figure 9: Cumulative Wealth Shares, 2014-Present

Cumulative wealth shares from 2014Q1 to the present (2018Q4). Chart plots the cumulative change in the wealth share for each of the wealth groups (top 1%, next 9%, next 40%, and bottom 50%) from 2014Q1, with the post-2016 quarters (after the latest SCF) shaded in grey. All of the series therefore start at 0 in 2014Q1 (by definition) and then evolve from there. The top 1% series increases steadily, gaining a cumulative total of 1.1 percentage points by 2018Q3 before falling dramatically to 0.4 percentage points in 2018Q$. The next 9% share increases modestly to 0.5 percentage points through 2016Q1 before declining steadily to 0 percentage points by 2018Q4. The next 40% series declines steadily through 2018Q3, before rebounding notably in 2018Q4 ending up at -1 percentage points. The bottom 50% share increases steadily, but less rapidly than the top 1% series, ending up at about 0.6 percentage points.

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Figure 10: Household Balance Sheets Across the Wealth Distribution During the Financial Crisis
Notes: The 2007Q3 columns show the DFA balance sheets for 2007Q3 estimated using SCF and Financial Accounts data only through that date. The 2009Q1 (Limited) columns show the extrapolated DFA balance sheets for 2009Q1 using SCF data only through 2007Q3 and Financial Accounts data through 2009Q1. The 2009Q1 columns show the actual DFA balance sheet estimates for 2009Q1 using all available SCF and Financial Accounts data. All panels use the (current) 2018Q4 vintage of the Financial Accounts.

Four Panels. Each panel shows several DFA balance sheets for a different wealth group (top 1%, next 9%, next 40%, and bottom 50%). The balance sheets break out the following categories: financial assets, other nonfinancial assets, real estate, mortgages (liabilities), and other liabilities. Net worth is also shown for each balance sheet.

Panel A: Selected DFA balance sheets for the top 1% wealth group. Three balance sheets are shown. The first is for 2007Q3, which shows about $18 trillion in net worth, very low liabilities, and assets dominated by financial holdings. The next column shows the 2009Q1 balance sheet calculated using the "limited" data, while the third column shows the actual balance sheet using all available data for 2009Q1. Net worth for both the second and third balance sheets is lower, with financial assets declining notably. However, the two balance sheets are very similar to each other, with the "limited" balance sheet over-estimating net worth by about $0.5 trillion (out of $14.2 trillion).

Panel B: The same chart as Panel A, but for the next 9% wealth group. Compared to the top 1%, this group has a smaller share of financial assets, more real estate wealth, and more mortgage liabilities. The second and third balance sheets again show a tight concordance between the "limited" and actual balance sheets, with the "limited" balance sheet understating net worth in 2009Q1 by about $2 trillion (out of $22 trillion).

Panel C: The same chart as in Panel A, but for the next 40% wealth group. Compared to the top 1%, this group has a much smaller share of financial assets, more real estate wealth, and more mortgage liabilities. The second and third balance sheets again show a close concordance between the "limited" and actual balance sheets, with the "limited" balance sheet overstating net worth in 2009Q1 by $2 trillion (out of $16.6 trillion).

Panel D: The same chart as in Panel A, but for the bottom 40% wealth group. Compared to the top 1%, this group has very little financial wealth, a larger share of real estate and other nonfinancial assets, substantially more liabilities, and close to 0 net worth. The second and third balance sheets again show a close concordance between the "limited" and actual balance sheets, with the limited balance sheet showing very similar asset totals but about half a trillion more in liabilities and about half a trillion less in net worth.

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Figure A.1: Life Insurance Reserve per Dollar of Death Benefit for Sample Policies, Issue Age 45

Reserve per $ of Death Benefit for Issue at Age 45. The x-axis shows ages ranging from 45 to 110, while the y-axis shows reserve amounts ranging from $0 to $0.16 per dollar of death benefit. Curves are plotted for a number of different products -- 5, 10, 15, 20, and 30 year term along with whole life. Each curve starts at 0 at age 45, increases for a time, before declining back to 0 either at the end of the term or after age 100 for whole life. The whole life curve is much above the term life curves, peaking at $0.16 around age 69. By comparison, the 30 year term curve, the next highest, peaks at $0.04 around age 60.

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Figure E.1: Household Balance Sheets Across the Wealth Distribution During the Financial Crisis (Detailed)

Two Panels which present a more detailed look at some of the DFA balance sheets presented already in Figure 10. The categories shown are real estate, consumer durables, equities/mutual funds, pensions, noncorporate equity, other financial assets, mortgages (liabilities), consumer credit, other liabilities, and net worth.

Left Panel: The pseudo real-time ("limited") 2009Q1 balance sheets for each wealth group. Right Panel: the actual DFA balance sheets for 2009Q1. The main takeaway from these two panels is the very close match between the "limited" and actual DFA balance sheets across each of these much more detailed categories.

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