Wealth Declines during the Recession

The LA Times carried a story yesterday on the comparative wealth decline by region during the recession.  The period of study is 2007-2009.  According to Federal Reserve data the recent recession has been harsher on the Western states than the rest of the country.  In the Western states 67.5% of the households saw their net worth fall, compared with 62.5% in the U.S. overall. The median decline in wealth was also much larger in the West with 27% than the national median of 18.1%.  In net worth statistics for households that meant a drop from just under $600,000 to $481,000.

Not surprisingly, the main declines among all households was in financial assets (stocks, bonds, retirement accounts) and in real property (first and second houses).   Median debt on both installment loans and credit card balances went up.   Before the recession, housing prices in the West generally (it is assumed that California, because of its size distorts the data) were frothier.