Is the U.S. economy better off than it was a year ago? Millionaires, more than lesser wealth segments, believe so, according to a new investor survey conducted by Millionaire Corner.
63 percent of Millionaires share this optimistic view of the U.S. economy, compared to 57 percent of respondents overall. Confidence in the strengthening of the economy increased with net worth. Thirty-six percent of those with a net worth of less than $100,000, for example, said the economy is now doing better now compared to 51 percent of those with between $100,000 and $500,000.
What benchmarks were the most impactful in shaping Millionaires’ beliefs in the economy’s recovery? For 46 percent, it was the drop in the unemployment rate, which currently stands at 8.3 percent, down from around 9 percent, where it had remained for most of 2011. In testimony late last month before the House of Representatives Financial Services Committee, Federal Reserve Chairman Ben Bernanke said that the drop of the unemployment rate in January to its present level was “somewhat more rapid than might have been expected, given the economy appears to have been growing during that time frame at or below its long-term trend.",
The stock market’s recent rally above the 13,000 mark was significant to 38 percent of Millionaires.
What do Millionaires need to see further to convince them that the economy will continue to improve? More than half (51 percent) said sustained economic growth over the next year, while one-quarter said a drop in the unemployment rate under 6 percent, a level it has not reached since July 2008, when it was 5.8 percent. A 2011 Office of Management and Budget report projects that unemployment will not drop to 6 percent until 2016.
Almost 10 percent of investors overall said that they would believe the economy is improving if gas prices fell below $3.50. This attitude decreases with wealth, with 15 percent of those with a net worth below $100,000 sharing the $3.50 benchmark and only 5.5 percent of Millionaires thinking this indicates an improvement in the economy.
Donald Liebenson writes news and features for Millionaire Corner. He has been published in the Chicago Tribune, The Chicago Sun-Times, The Los Angeles Times, Fiscal Times, Entertainment Weekly, Huffington Post, and other outlets. He has also served as a marketing writer for Chicago-based Questar Entertainment and distributor Baker & Taylor.
A graduate of the University of Southern California, he is married with a college-age son. He also writes extensively about entertainment.