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“CONTINUING BONUSES FOR BANKERS” mentioning the U.S. Dept. of Commerce was published in the House of Representatives section on pages H6665-H6666 on June 12, 2009.
The publication is reproduced in full below:
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CONTINUING BONUSES FOR BANKERS
(Ms. KAPTUR asked and was given permission to address the House for 1 minute.)
Ms. KAPTUR. Madam Speaker, since January, the American people have endured another loss of $1.33 trillion of their wealth, having already faced the worst drop in wealth since 1951 in the prior quarter. Yet despite being at the root of our economy's tailspin, Wall Street continues to issue huge bonuses.
For example, Merrill Lynch has issued $4 billion in bonuses to the very bankers and financiers who created this mess that are now nested over at the Bank of America. This is yet another sign that America needs to rein in the false money wizards and reward those who create real wealth in our society, starting with hardworking Americans.
So let me ask the question, when will Wall Street's profits translate into a better life for everyone else? With wealth declining and unemployment rising, America should not be hollowed out by Wall Street. Rather, Wall Street's business should translate into a better way of life for the American Republic. We have wandered far from that mark.
Americans' Net Worth Shrinks $1.33 Trillion in 1Q
(By Jeannine Aversa)
Washington.--American households lost $1.33 trillion of their wealth in the first three months of the year as the recession took a bite out of stock portfolios and dragged down home prices.
The Federal Reserve reported Thursday that household net worth fell to $50.38 trillion in the January-March quarter, the lowest level since the third quarter of 2004. The first-quarter figure marked a decline of 2.6 percent, or
$1.33 trillion, from the final quarter of 2008.
Net worth represents total assets such as homes and checking accounts, minus liabilities like mortgages and credit card debt.
The damage to wealth in the first quarter came from the sinking stock market. The value of Americans' stock holdings dropped 5.8 percent from the final quarter of last year.
The stock market began to rally from 12-year lows in early March after Citigroup Inc. reported it was profitable in the first two months of the year. Since peaking in October 2007, it had been the worst bear market since the aftermath of the crash of 1929.
Another hit came from falling house prices. The value of household real-estate holdings fell 2.4 percent, according to the Fed report.
Collectively, homeowners had only 41.4 percent equity in their homes in the first quarter. That was down from 42.9 percent in the fourth quarter and was the lowest on records dating to 1945.
The Case-Shiller national home price index, a closely watched barometer, last month estimated that house prices dropped 7.5 percent during the first quarter. Prices have fallen 32.2 percent since peaking in the second quarter of 2006.
The latest snapshot of Americans' balance sheets was contained in the Fed's quarterly report called the flow of funds.
Despite the drop, the speed at which net worth shrunk slowed at the start of the year. During the recession's deepest point in the October-December period, Americans' net worth fell a record 8.6 percent, according to revised figures. That was the largest drop on records dating to 1951.
With wealth declining and unemployment rising, there are questions about how consumers--the lifeblood of the economy--will behave in the coming months.
If they continue to spend, even at a subdued pace, the recession likely will end this year as predicted by Fed Chairman Ben Bernanke and other economists. However, if consumers hunker down and cut spending again, that could delay any recovery. In the final quarter of last year, Americans slashed spending at an annualized rate of 4.3 percent, the most in 28 years.
Still, there was some encouraging news on consumer spending Thursday.
Retail sales rose 0.5 percent in May, following two straight monthly declines, the Commerce Department reported. Meanwhile, the number of newly laid-off workers filing for unemployment benefits fell last week by 24,000 to 601,000, the lowest level since late January.
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