Salient to Investors:

Matthew C. Klein writes:

GDP has been expanding at the same rate in half1 as it has since mid-2010, showing that Fed stimulus has offset fiscal tightening.

However, growth is still too anemic to return to anything resembling full employment for several more years, even under the most optimistic assumptions.

US Bureau of Economic Analysis data indicates that most of the modest growth has gone to the small share of the population that owns the vast majority of the country’s assets. Since the beginning of 2013, total personal income has increased by $323.3 billion, while total employee compensation has increased by $112.5 billion. Income from real estate rent, dividends on stocks and interest payments on bonds accounted for $186.7 billion. The balance came from Social Security, Medicare, Medicaid, and veterans’ benefits. Workers average share of income growth since the beginning of 2010 is about half.

Higher returns on assets have not encouraged new business investment, while disproportionate employment growth has been in low-paying services industries, despite most of the jobs lost in the recession paid wages closer to the median income.

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