The United States is a capitalist industrialized country based on private ownership . Through the quantification of data, we can better understand this qualitative nature of the United States.
As the world's largest capitalist country , in the 70 years since the end of World War II, driven by the rapid growth of financial assets, the total assets of the United States have reached a scale of 440 trillion US dollars, of which the scale of financial assets The proportion is close to 77%. Compared with the end of World War II, the total assets of the United States have increased more than 200 times.
As a country based on private ownership, the total assets owned by American residents and non-profit institutions account for about 40%, and the net assets account for about 60%. The majority of the net worth is owned by U.S. residents and non-profit organization .
As a country with federal system , the U.S. federal government is responsible for handling domestic and foreign public affairs. Although the U.S. federal government has huge influence on a global scale, in the field of U.S. capital, the U.S. federal government’s share of total assets is gradually declining. Since the 1980s, with the rapid growth of debt scale, the debt scale of the U.S. federal government has exceeded its asset scale by more than three times, and its negative net asset ratio has also maintained a growing trend over the past 40 years.
As the capitalist country with the largest assets in the world, asset expansion driven by financial assets is not limited to the United States. Investment in overseas assets is also an important means for the growth of the United States' total assets and net assets.
After the end of World War II, the U.S. economy experienced multiple recessions due to different reasons, but overall it did not affect the rapid growth of its total assets. Different from previous economic recessions after World War II, in 2008, affected by the financial crisis caused by the outbreak of the subprime mortgage crisis, both financial and non-financial assets in the United States depreciated, resulting in the only recession since the end of World War II. Depreciation of total and net assets. From the perspective of asset scale, the financial crisis caused by the subprime mortgage crisis was the most serious blow to the U.S. asset system after the end of World War II.
* The following charts are organized and presented based on data released by the Fed website. Affected by market prices, asset scale changes dynamically. The data in the chart is only a quantitative reference, and its absolute value cannot fully reflect the real-time situation of asset scale. Analytical data such as asset size, asset composition ratio, net asset ratio, and debt-to-asset ratio can better show what kind of country the United States is and how its assets have changed over the past 70 years.
Figure 1 Total assets of the United States (1946-2021)
In 2021, according to market value estimates, the total assets of the United States exceeded US$400 trillion. Compared with the end of World War II, the total assets of the United States increased by more than 200 times. Before entering the 21st century, the total assets of the United States generally maintained a relatively high growth rate. After entering the 21st century, the growth rate of total assets of the United States fluctuated greatly. In 2008, it was the only time since the end of World War II that the total assets of the United States have shrunk. Total assets shrank by nearly 20 trillion US dollars, and the asset shrinkage exceeded 8.5%.
The assets of the United States are mainly composed of financial assets and non-financial assets. Since the 1980s, the scale of financial assets has shown a rapid growth trend, and the proportion of assets has continued to rise. In 2021, financial assets accounted for more than 76% of U.S. assets.
In 1951, the proportion of net assets in the United States to total assets reached 65.94%. In the following 60 years, the net asset rate in the United States generally maintained a downward trend. In 2011, the net asset rate had dropped to less than 43%. After 2011, the net asset ratio in the United States showed an increasing trend. In 2021, the net asset ratio has rebounded to more than 50%. From a purely asset perspective, the recovery in the net asset ratio not only reflects the decline in asset and liability levels, but also reflects the decline in asset equity risks.
Figure 2 U.S. non-financial assets (1946-2021)
U.S. non-financial assets (excluding financial institutions) mainly consist of real estate, durable goods, equipment, intellectual property, and inventories. Among them, real estate is the most important non-financial asset.The proportion of real estate in non-financial assets in the United States has basically remained above 70%.
Unlike other real estate, residential property, as a consumer asset, is not a productive asset that supports industrial production and services like non-residential real estate, equipment, intellectual property and other assets. Since the 1980s, the proportion of residential real estate in non-financial assets in the United States has shown a rapid growth trend, reaching a peak of more than 47%. As the proportion of residential real estate assets increases, not only the proportion of real estate in U.S. non-financial assets has also increased, but also the proportion of consumer assets such as housing and durable goods in U.S. non-financial assets has also increased.
Land that has not been developed commercially is not included as an asset in the non-financial assets of the United States. This also reflects that as a modern industrialized country, the statistics of non-financial assets in the United States are more focused on industrial production and services. Assets that provide support.
In 2021, the scale of U.S. non-financial assets calculated according to market value will be approximately US$110 trillion. In the more than 70 years after the end of World War II, the growth rate of non-financial assets was generally lower than the growth rate of financial assets. With the rapid growth of residential assets since the 1980s, the growth rate of productive assets used for production and services in the United States has further slowed down.
The subprime mortgage crisis triggered by the decline in housing prices was the financial crisis that had the greatest negative impact on U.S. asset growth since the end of World War II. The depreciation of residential assets caused by the decline in residential prices has also become the main reason for the devaluation of non-financial assets in the United States after the outbreak of the subprime mortgage crisis.
Figure 3 U.S. financial assets (1946-2021)
Compared with non-financial assets, U.S. financial assets not only showed a faster growth rate but also showed greater volatility in the more than 70 years after the end of World War II. Money market assets consisting of cash deposits, savings deposits, monetary funds, and loans; bond market consisting of treasury bonds, agency bonds, municipal bonds, and corporate bonds; stock market consisting of asset equity, as well as pension insurance, property insurance, and other The insurance market composed of insurance is the main financial asset trading market in the United States. The size of financial assets in the United States is mainly determined by the asset transaction prices in the above-mentioned financial trading markets.
In different markets, financial assets have different security, growth and liquidity. Assets with various attributes also produce different trends under the influence of the external economic environment, and their contributions to the growth of financial assets are also different. . Since the 1970s, the growth rate of assets in the above-mentioned traditional financial trading markets has slowed down. Among them, the growth rate of owners' equity of non-commercial institutions has been relatively slow, and their proportion of financial assets has increased from nearly 10% after the end of World War II. 20%, dropped to less than 5%. Mutual funds , foreign investment and certain financial assets not clearly classified showed rapid growth.
In addition to the above-mentioned financial assets, official reserve assets, Special Drawing Rights , overseas savings, securities repurchases, trade receivables, tax receivables, and financial derivatives and other financial assets account for 50% of the total size of U.S. financial assets. The proportion is about 10%.
Unlike non-financial assets, financial assets are an intangible current asset. Currency, as a medium of transaction, is the most traditional financial asset. Similar to currency, financial assets all have the properties of a medium of exchange. Different financial assets, due to different transaction objects, present time-related risk differences. Financial assets consist of two parts: asset equity and asset liabilities. The equity owner obtains income according to the equity share, and the asset and liability party must perform corresponding responsibilities (repaying principal and paying expenses) in accordance with different agreements on assets and liabilities.
From the end of World War II to the 1980s, the proportion of assets and liabilities in U.S. financial assets increased from 65% to 80%. The rapid growth in the scale of assets and liabilities is also a manifestation of the growth of asset risks. From the 1990s to 2008, the ratio of assets and liabilities to U.S. financial assets showed certain fluctuations. Since then, the ratio of assets and liabilities has shown a downward trend.
Whether it is financial assets or non-financial assets, 2008 is a turning point.After experiencing asset depreciation, both financial and non-financial assets in the United States have resumed growth. As the ratio of assets to liabilities declines, the net equity ratio in the United States also shows an upward trend.
Figure 4 Asset distribution in the United States (1946-2021)
As a capitalist industrialized country based on private ownership, the assets owned by American residents, non-profit institutions, non-financial institutions, and financial institutions account for about 80% of the total assets of the United States. . Driven by the rapid growth in the scale of financial assets, the proportion of assets held by U.S. financial institutions has also shown a rapid growth trend. The scale of assets held by financial institutions has exceeded that of non-financial institutions. After entering the 21st century, the proportion of assets held by U.S. financial institutions has basically remained at around 30%.
Although the assets held by U.S. residents and non-profit institutions only account for about 40%, due to the high net asset ratio of residents and non-profit institutions, their net assets account for more than 60% of U.S. net assets. This also means that the majority of U.S. net worth is in private and non-profit hands.
The United States is a federal country. The federal government consists of three major institutions: Congress, the President, and the federal courts. In addition to having legislative power, the federal government is mainly responsible for domestic and foreign public affairs including national defense and trade. Although the U.S. federal government has a very strong influence in international politics, in the face of assets, the U.S. federal government appears to be very weak compared with other domestic organizations and institutions. From the end of World War II to the present, the proportion of assets owned by the U.S. federal government (excluding land) in U.S. assets has gradually declined, and the scale of assets owned by it has been far lower than that of state and local governments. In addition to its lower asset scale and slower growth rate, the U.S. federal government's debt scale is higher than its asset scale. It is the only socioeconomic unit among different types of organizations and institutions in the United States with a net asset ratio less than zero.
From the end of World War II to the 1980s, the net asset ratio of the U.S. federal government generally showed an increasing trend. According to this trend, the U.S. federal government is also expected to achieve positive net assets. For the U.S. federal government, the 1980s was a turning point in assets and liabilities. With the relatively rapid growth of liabilities, the rising trend of the net asset ratio of the U.S. federal government was reversed. After more than 40 years of decline, the U.S. federal government’s net asset ratio The net equity ratio has dropped to -270%. This also means that the U.S. federal government’s liabilities have exceeded its total assets by more than three times.
In addition to private and non-profit organizations, commercial enterprises and non-commercial enterprises other than financial institutions are the other major owners of net assets in the United States. The scale of net assets owned by commercial and non-financial institutions gradually dropped from 34% to 20%.
Driven by capital expansion, the proportion of assets owned by American financial companies has gradually increased, which has also led to a relatively rapid growth in their net assets. Through capital expansion, the scale of overseas assets owned by U.S. companies and capital has also shown a rapid growth trend. The net asset value between the assets acquired by the U.S.’s foreign investment and the investment of foreign funds in the U.S. has also become an important area for the growth of U.S. net assets.
