The Federal Reserve, for example, uses a model of the economy in which housing wealth influences consumer spending to exactly the same degree that financial wealth does.
The company operates business through three segments: Business Services, Consumer Services and Wealth Management.
In either case the weakening effect on the dollar should lift short-term earnings prospects for American exporters and the positive market response should spur consumer spending via the wealth effect.
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The authors find an effect of housing wealth on consumer spending that is both much lower than earlier research suggests and a lot smaller than the effect of changes in equity wealth.
He set out what might happen if American house prices fell by a massive 20% in 2007-08, assuming that an extra dollar of housing wealth changed consumer spending by 3.8 cents (as in the Fed's own model).
House prices have a far bigger wealth effect on consumer spending than share prices do.
First, house prices have a bigger wealth effect on consumer spending, largely because more people own their homes than own shares.
If that happens, selling will beget more selling, and falling stock prices will cut investment, consumer spending (via the wealth effect), and tax receipts.
Even though house prices in France, Italy and Spain have risen by more than in the United States, the wealth effect on consumer spending has been smaller (see article).
That is a sizeable hit, and it comes on top of the other problems facing America's economy, such as the drag on consumer spending from falling housing wealth or a weaker job market.
Too many people have made too much money, in bonds as well as in stocks, since 1994 to change their lifestyles radically just because their net worths shrivel a bit. (However, the wealth effect on consumer spending could surface if the market drops 20% or more.) Lower interest rates will help sustain consumer spending.
Plus, it has a wealth of expertise building consumer-friendly flat-screen televisions and movie players.
If share and home prices stabilise, that will mitigate the astonishing loss of wealth that is depressing consumer spending.
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As Mr Bernanke remarked in a speech a few months ago, this suggests that changes in property prices should affect consumer spending by more than conventional wealth effects imply.
These are three very different measures of rich: accumulated wealth, annual production and consumer lifestyle.
It was hoped that this would achieve what low short-term rates had not: an increase in stock and real estate prices, a rise in household wealth, and consequently greater consumer spending, economic growth, and job creation.
This would reduce the stimulus to consumer spending from households releasing some of their wealth by borrowing against their properties.
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The explosion in stockmarket wealth has been an important driving force behind consumer spending.
At the same time, a new consumer brief from the Society of Actuaries suggests how much wealth you should have for coverage to make sense.
The Fed justified its second round of quantitative easing partly on grounds that the wealth effect of rising stock prices would stimulate consumer spending and, by extension, boost output and reduce unemployment.
For rising stockmarket wealth to have a large impact on average consumer-spending there would need to be an even larger impact on the consumption of the minority of households with big shareholdings.
Consumer spending seems unsustainably strong given weak income growth, shrunken wealth, and tight-fisted banks.
The Fed's explicit goal has been to lift asset prices as a way to create a "wealth effect, " which is supposed to boost consumer and business confidence.
He said a lot of it is consumer driven and could be because there is an increase in wealth and people want to buy gold with their money.
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Since the rampant stockmarket is, through its wealth effect, now a big contributor to booming consumer spending, it is hard to see demand slowing until borrowing costs rise by rather more.
That suggests that consumer spending could remain modest as many Americans try to rebuild their wealth by saving more and paying off debts.
And a greater consumer surplus is, by definition, some of that increase in wealth going to the consumers, not the owners of the means of production.
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