ASSET ALLOCATION

On 12/31/24, US households held $38 trillion in public firm equities, 1.7 times disposable income. During the late 1960s, during the Dotcom Boom, and as recently as 2020, it reached but never exceeded 1.2. A decline in equity prices, now more than ever, risks reducing consumer sentiment and thus spending, particularly among the top 20% of earners who hold 87% of equities and do a stunning 60% of all spending.