Expect global shockwaves as the “Great Reset” unfolds in 2018.
Financial Accounts of the United States – Z.1
Subsection: B.101.e Balance Sheet of Households and Nonprofit Organizations with Equity Detail
(King World News) – Email to KWN from Kevin W.: Interesting that in Q3 2017, US Household Net Worth accounted for $96.9 trillion or 34.6% of Global Net Worth totaling $280 trillion, while US GDP of $18.6 trillion only makes up about 24% of world GDP. Whereas China Household Net Worth at $29 trillion equals about 10.3% of Global Net Worth, while China GDP of $11.1 trillion makes up 14% of world GDP.
The Massive Transfer Of Wealth Will Create Global Shockwaves
Stay tuned as gold price discovery and reset rewards the gold saving Chinese Households at the expense of US and other Western Households that have for more than 40 years over-consumed and under-saved, with little to no gold set aside for rainy days.
China: 16,000 Tonnes Of Gold – India: 20,000 Tonnes Of Gold
With Chinese Households accumulating some 16,000 metric tonnes or 500 million ounces of physical gold since restrictions were lifted in 2008, $11,000/oz gold will quickly added nearly $5 trillion to their wealth. India will see over $6.25 trillion in added wealth to their post-2008 8,000 metric tonnes of gold accumulation & 12,000 metric tonnes pre-2008. In other words, the West will experience a massive transfer of wealth to the East.
Equities are ripe for a big decline relative to all financial assets. Real estate will also plunge because forced liquidations will ensue as DPI is insufficient for servicing over-leveraged debt and mortgage debt…
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Financial Assets/Total Assets – Non-financial assets in Q3 2017 officially made up 70.4% of all assets — at record levels exceeding Q4 2007 at 62.8% & equaling Q4 1999 at 70.4%. The decline in financial assets relative to total assets at the bear market lows of 2002 and 2009 where financial assets suffered much worse than “hard assets” in 2009. More amazing according to Credit Suisse Global Wealth Data book 2017 for Q2 (page 101) is that Chinese Household Financial Assets make up only 42% of total assets. Meaning, the bulk of Chinese Household Assets at 58% are in “real” hard assets, not “virtual or paper” assets. http://publications.credit-suisse.com/tasks/render/file/index.cfm?fileid=432759CA-0A73-57F6-04C67EF7EE506040
Q3 2017- 70.4%
Q1 2009- 62.4%
Q4 2007- 62.8%
Q4 2002- 61.7%
Q4 1999- 70.4%
Net Worth/Disposable Personal Income (DPI) – Net Worth in Q3 2017 officially made up 673% of DPI, blowing away Q4 2007 at 615% and Q4 1999 at 632%. The decline in Net Worth relative to DPI at the bear market lows of 2002 and 2009 by over 24% and 21% respectively. Q4 2017, U.S. Equities are valued at about $29 trillion or 200% of DPI, also a record. Equities are ripe for a big fall, and Real estate will tank as well because forced liquidations will ensue as DPI is insufficient for servicing mortgage debt as interest rates rise — with or without employment being affected.
Q3 2017- 673%
Q1 2009- 467%
Q4 2007- 615%
Q4 2002- 499%
Q4 1999- 632%
Corporate Equities, Mutual Funds, ETF shares/ Financial Assets – Corporate Equities held directly and indirectly in Q3 2017 officially made up 36.3% of all financial assets (Q4 2017 unofficially at 40%) nearly exceeding Q4 2007 37.1% but below Q4 1999 50.1%. Notice the decline in Equities, Mutual Funds & ETF shares at the bear market lows of 2002 and 2009 indicating stocks suffered much worse than both “other financial assets”. Equities are ripe for a big decline in prices relative to all financial assets.
Q3 2017- 36.3%
Q1 2009- 27.9%
Q4 2007- 37.1%
Q4 2002- 34.1%
Q4 1999- 50.1%
Corporate Equities, Mutual Funds, ETF shares/ Total Assets – Corporate Equities held directly and indirectly in Q3 2017 officially made up 25.5% of all assets (Q4 2017 unofficially at 28%) exceeding Q4 2007 23.3% but below Q4 1999 35.3%. Notice the decline in Equities, Mutual Funds & ETF shares at the bear market lows of 2002 and 2009 indicating stocks suffered much worse than both “other financial assets and hard assets”. Equities are ripe for a big decline in prices relative to all financial assets.
Q3 2017- 25.5%
Q1 2009- 17.4%
Q4 2007- 23.3%
Q4 2002- 21.0%
Q4 1999- 35.3%
Again, stay tuned as gold price discovery and reset rewards the gold saving Chinese Households at the expense of US and other Western Households that have for more than 40 years over-consumed and under-saved with little to no gold set aside for rainy days. It will without a doubt be the greatest transfer of wealth in world history, and the end of the glory days of the West.
The Bottom Line
King World News note: For KWN readers around the world, the point of Kevin’s email is to highlight the massive transfer of wealth that will take place when the world financial system is rebooted. There will be big winners (China & India) and big losers (the Western world). There will also be individual winners (investors) in the Western world that properly position themselves for the coming reset. Continue to accumulate physical gold and silver on pullbacks as well as the shares of the high-quality companies that mine the metals.
Current data:
https://www.federalreserve.gov/releases/z1/current/html/b101e.htm
https://www.federalreserve.gov/releases/z1/current/html/b101.htm
Historical data:
https://www.federalreserve.gov/releases/z1/20090611/accessible/b100e.htm
https://www.federalreserve.gov/releases/z1/20080306/accessible/b100e.htm
https://www.federalreserve.gov/releases/z1/20090611/accessible/b100.htm
https://www.federalreserve.gov/releases/z1/20080306/annuals/a1995-2004.pdf
https://www.federalreserve.gov/Releases/z1/default.htm#content
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