When those price bubbles burst, households lost substantial wealth and financial markets became dysfunctional.

Finally, there is households willingness to borrow to increase consumption, which is usually driven by perceptions about trends in household wealth.

The sharp drop in household wealth over the past two years, however, put an end to that.

Before it began rising last year, the US household saving rate had been declining for more than 20 years in response to the increasing level of household wealth.

A spike in long term rates would lower the price of JGBs, destroying household wealth and, in turn, reducing consumer spending.

The resulting rise in equity prices would increase household wealth, providing a boost to consumer spending.

By now, wealth in the form of owner occupied housing is down about 30 , equivalent to a loss of more than 6 trillion of household wealth.

If that trend continues, it will prevent further erosion of household wealth and strengthen the banks capital positions.

Fortunes

If they do, the sale of foreclosed properties will continue to depress house prices, reducing household wealth and hurting financial institutions.

Since share ownership (including mutual funds) of American households totals approximately 17 trillion, a 15 rise in share prices increased household wealth by about 2.5 trillion.

The Lost Wealth of Nations

Because of the boom in housing and stock market prices, US household net wealth increased by around 18 trillion during 1996 2006.

In addition, the Fed hopes that lower long term interest rates will push up asset prices, giving households more wealth and greater incentive to spend.

For, even if America s banks were healthy, household wealth has been devastated, and Americans were borrowing and consuming on the assumption that house prices would rise forever.

The sharp fall in house prices that followed caused a dramatic downturn in household wealth, leading to lower consumer spending and an overall fall in GDP.

Much architecture has been turned into rubble.

Paying down debt on credit cards or mortgages also counts as saving but increases in the value of existing assets like stocks or real estate do not, even though they increase the value of household wealth.

This time, however, the fall in share prices and in home values has destroyed more than 12 trillion of household wealth in the United States, an amount equal to more than 75 of GDP. Previous reactions to declines in household wealth indicate that such a fall will cut consumer spending by about 500 billion every year until wealth is restored.

Coral reef ecosystems are invaluable human treasures.

A spike in long term rates would lower the price of JGBs, destroying household wealth and, in turn, reducing consumer spending. The higher interest rates would also apply to corporate bonds and bank loans, weakening business investment.

But the macroeconomic weakness in the US now goes beyond the decreased supply of credit. Falling house prices reduce household wealth and therefore consumer spending.

After the death of Sixtus, the prefect of Rome demanded that St Lawrence turn over the riches of the Church.

When it comes to laws on the books, no generation has inherited the riches that we have.

The rise in food and energy prices outpaced the gain in nominal wages, causing real average weekly earnings to decline in January, while the continued fall in home prices reduced wealth for the majority of households.

For many poor countries, wealth in natural resources is a curse rather than a benefit.

Otherwise, financial destabilization will threaten the fortunes of the very rich.

Strengthening families

Family poverty.

Remember that Adam Smith called his great work An Inquiry into the Nature and Causes of the Wealth of Nations.

Some developing countries, most notably Brazil, have discovered huge potential offshore riches.

Adam Smith s 1776 treatise The Wealth of Nations masterfully demolished many of these ideas.

After Bear Stearns and Lehman Brothers melted down, ushering in a worldwide crisis, media reports largely assumed that the wealth of these firms executives was wiped out, together with that of the firms they navigated into disaster.

Loosing families and homes

A highly productive society based on a sophisticated division of labor was how you secured the wealth of nations.

Don t worry, Russia s oligarchs are not starving, but the fortunes of many of them have collapsed.

Their fecklessness and recklessness are what convince much of the world that Africans can do nothing but dance, slaughter each other, and beg. Easy access to oil wealth only allows their cynical frivolity to continue.

Some big businesses in privileged positions would make a fortune from exploiting this rather rigged market.

A billionaire telecommunications tycoon, Thaksin presided over the trebling of his family s assets in the stock market.

It appears to run in families.

Single Parent Families

Most families owned slaves as household servants and labourers, and even poor families might have owned a few slaves.

All these provocations add upward pressure on oil prices, enriching the Iranian government.

Australia is lucky to have a rich endowment of natural resources, including iron ore.

In Libya, the fortunes of Saif al Islam and Muatasim have waxed and waned as Qaddafi enforces his authority to prevent the emergence of a challenger.