As debate heats up over a possible chilling effect on charitable giving from President Bush’s proposed repeal of the estate tax, the government says the slumping stock market prompted a 2 percent drop in the net worth of U.S. households last year, the Associated Press reported March 13.
The annual decline was the first in 55 years, with Americans’ net worth declining to $41.42 trillion at the end of 2000, down $841.5 billion from the end of 1999, the Federal Reserve said.
Last year’s drop followed five straight years of big increases driven by the booming stock market, AP said.
“The bursting of the stock market bubble has eroded household balance sheets and undermined the willingness and ability of Americans to spend as aggressively as they had been spending,” Mark Zandi, an economist at Economy.com, a consulting firm in West Chester, Pa., told AP.
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