Income from assets has become an important source of wealth for Americans, but at the same time led to strengthening economic inequality in the country. Over the past few decades, the indicators of this source grew in the most prosperous regions of the country, but 90 percent of the poor regions remained at the same level, Bloomberg writes.
Profit from assets, including promotions, renting property for rent and interest, now on average in the country is the fifth of personal income. However, most Americans have such resources. Their only assets are their own dwellings and retirement accounts, which often do not have citizens with low earnings.
The Group on Economic Innovation from District Columbia established in its recent report that the gap between the rich and poor areas of the country is growing in geometric progression. In the period from 1969 to 1990, the average income difference between the two groups of regions doubled, and in the period from 1990 to 2019 increased six times.
Profit from assets is usually concentrated in districts, which are centers of finance, mining, technology and tourism. According to the Group on Economic Innovation, the growth of the digital economy (e-commerce with the use of digital technologies) and mitigating monetary policy increased the gap between the poor and rich Americans. Thanks to these processes, the assets holders received even greater income and “super-profile from technological companies.”
Assets are practically absent in most of the population in the area of the mountain chain of Appalachi, the Midwest and the far south of the country. The welfare rupture is very large in megalopolis, since the incomes of technological and financial centers rapidly grow. For example, in the New York district of Manhattan, the average family income is twice as high as in the neighboring area of Bronx. There is also a gap in racial wealth.
Earlier, the US Federal Reserve published the minutes of the meeting, where the collapse of the quantitative softening program was announced (QE). This means that the authorities will cease to stimulate the American economy at the expense of the budget, which can negatively affect consumer demand. Investors are confident that in the near future a recession will happen in the country.