HIGHTOWER: Stock Wealth
Some days I think that rather than reading the newspaper, it'd be a lot less frustrating to just whap myself upside the head with it.This New York Times article is a good example. It's the lead story on the front page, and it has a Happy-News headline that blares: "Share of Wealth In Stock Holdings Hits 50-Year High." The gist of it is that the booming stock market is now the major source of wealth for American households, outstripping the value of homes as our greatest asset. The Times asserts that stock holdings make up more than a fourth of household wealth today.This story is not based on some official report, but on the newspaper's own analysis of wealth data. In other words, the story is manufactured by the Times, and the paper makes it appear to be very good news indeed: "Americans are feeling richer as the value of their stock holdings rise," the story gushes, adding that "where skyrocketing real estate prices once provided reassurance to the middle class, soaring stock portfolios now do."That's dandy ... except that it's wrong.Very few middle-classers own any stock to speak of, much less enough to reassure them. In fact, 67 percent of us Americans own no stock at all -- not through mutual funds, 401Ks, pension plans or in any other way. This two-thirds of our population is as stockless as the Times is clueless.The newspaper's deceptive report, you see, is averaging our households. For example, you might have zero in stock holdings, whereas some tycoon is sitting on a billion dollars worth. On average then, you and that tycoon each have half-a-billion in stock, statistically speaking, of course.This is Jim Hightower saying ... Yes, household stock-wealth is up dramatically ... but, the key question is, in whose households? Here's a final statistic to shed some light on the subject: 89 percent of all stock is owned by the richest 10 percent of Americans.Source:"Share of Wealth in stock holdings hits 50-year high" by Edward Wyatt. New York Times: Feb. 11, 1998.