The net worth of U.S. households declined in 3Q 2015 by -$1.23 trillion or -1.43% to $85.182 trillion, its first quarterly decline in four years!
Meanwhile, Canadian households saw their 3Q 2015 net worth increase by CAD$36 billion or 0.38% to a record CAD$9.436 trillion.
Australian households saw their 3Q 2015 net worth increase by AUD$72 billion or 0.86% to a record AUD$8.489 trillion.
3Q 2015 was the first quarter in over 15 years that U.S. household net worth declined more than -1% vs. both Canadian and Australian household net worth rising in their local currencies. The last time that this occurred was 2Q 2000 – one quarter after the value of stocks and mutual funds owned by U.S. households peaked at a record high of $12.86 trillion. Afterwards, U.S. households saw their stocks/mutual funds decline in value by 47%.
Interestingly, the value of stocks and mutual funds owned by U.S. households reached a new record high in 2Q 2015 of $22.38 trillion, before declining last quarter by $1.79 trillion. Last quarter’s major divergence in U.S. household net worth vs. Canada and Australia could once again be an indicator of 2Q 2015 being a major peak in the value of stocks/mutual funds owned by U.S. households. Another 40%-50% decline in stock/mutual fund values is likely to occur in 2016/2017 – as gold and silver prices explode through the roof!
America’s household net worth as a % of GDP peaked in 1Q 2015 at a new record high of 486.08% and has since declined for two straight quarters – finishing 3Q 2015 at 471.54% down 1,454 basis points from the peak. Historically, any time that U.S. household net worth as a % of GDP has declined by over 1,400 basis points from an all-time high – it has marked the official beginning of a major multi-year downtrend. The last two downtrends resulted in U.S. household net worth/GDP declining to bottoms of between 381.87% and 384.74%.
Canada finished 3Q 2015 with a household net worth/GDP percentage of 472.61%, which is now higher than America’s household net worth/GDP percentage for the first time in 3 1/2 years! Shockingly, despite Canada having a higher household net worth/GDP percentage than the U.S., America’s household net worth per capita of $264,603 is now one-third higher than Canada’s household net worth per capita in USD of $198,392!
Currently, for the first time in history, the U.S. has a lower household net worth/GDP percentage than both Canada and Australia – while simultaneously having higher household net worth per capita in USD than both Canada and Australia! In NIA’s opinion, this is 100% absolute confirmation that the U.S. dollar has peaked and its rally is over. A dramatic reversal to the downside for the U.S. dollar is imminent. As the dollar begins to collapse from these extremely overbought levels – gold/silver prices will explode higher!
Take a look at how extreme the divergence has become between U.S./Canada household net worth per capita in USD and U.S./Canada household net worth as a % of GDP. Never has the U.S. dollar been more overvalued vs. the Canadian dollar than it is today.
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