December 8th, 2011
10:38 PM ET

Letters to the President #1053: 'Household wealth takes a dive'

Reporter's Note: Every single day I write a letter to the White House. It is possible that this disturbs them, but until they complain…I press on.

Dear Mr. President,

No doubt you viewed with some dismay this latest report about household wealth taking another nosedive; down more than 4 percent in the third quarter, or about $7800 for every citizen. As I’ve told you and the IRS many times, I’m no expert on finances, but this certainly doesn’t sound like a good thing.

As best I can make out, the issue continues to be 1) low home values, 2) the continuing fluctuations in the stock market and 3) possibly something to do with hog futures. (I never have entirely understood that third concept, so it is always on my list of suspects.)

Whatever the reason, people are finding their net worth not worth what is once was, and I’m sure no one is thrilled about that. Now, I should note that for many people these are probably just paper losses. By that, I mean, unless they try to sell their homes or their stock portfolio right now, the losses will not necessarily be made concrete. The value of everything could conceivably recover in time and they could be wholly restored.

But I find that such arguments usually don’t go very far with people who feel they have been screwed over. They either doubt that such a recovery will ever happen, or they say something like, “yes, I may recover what I lost in terms of dollars, but if it takes ten years to do that, how do I recover the lost decade which I was counting on for those investments to make even more money?” It’s a fair point.

My personal solution to this problem? Well, I try not to spend too much time looking at my net worth. Sometimes I am sure it is up, and other times I am sure it is down. I just keep plowing ahead, paying the bills, saving all I can, and not worrying about things I can’t change anyway.

Speaking of which, did you see all that miserable rain yesterday? Remarkable for December. But then, it is a season of unusual events, isn’t it?

Call if you have a moment. Assuming my ever-uncooperative cell phone is working we can chat a bit.


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Filed under: Letters to the President • Opinion • President Barack Obama • T1 • Tom Foreman
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