The 1st quarter put a wallop on household assets

The first quarter put a wallop on household finances. According to the latest release from the Federal Reserve, which monitors asset levels through the end of March, equities as a percentage of households' total assets fell from 32.4% to 27.4%. 

As a percentage of GDP, equity holdings plunged even further, from 94.8% to 73.3%. 

Equities as a % of GDP Buffett Indicator

That's the largest drop on record. Never before had equities dropped more than 20% as a percentage of the economy in only one quarter. Quarters when equities declined 10% or more coincided with major bottoms in stocks four (arguably five) times but was too early twice.

Equities as % of GDP drops hard

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We also looked at:

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  • Robinhood traders rushed into inverse (short) ETFs on Thursday
  • Small options traders are showing record speculative activity
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The post titled The 1st quarter put a wallop on household assets was originally published as on on 2020-06-15.

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