This chart from Credit Suisse's Global Wealth report graphs the ratio of wealth to disposable household income in the United States from 1900 to present. According to Credit Suisse, inequality is the highest its been in the United States since the Great Depression. (CC/Credit Suisse)
ZURICH, Switzerland, Oct. 14 (UPI) -- Wealth inequality in the United States is the highest it's been since the Great Depression, according to a Swiss bank.
Credit Suisse, a multinational financial services holding company headquartered in Zurich, released the fifth edition of its annual Global Wealth Report Monday. The 64-page document devotes this year's special topic to inequality and details that while America's wealth has increased, its average household income has not, widening the wealth/income ratio and therefore the inequality gap.
According to the report, 48 percent of the world's wealth is held by the richest one percent, much of it by U.S. citizens.
"The USA has by far the greatest number of members of the top 1% global wealth group, and accounts for 41% of the world's millionaires."
The report analyzes inequality using the ratio of a nation's wealth against its disposable household income.
"For more than a century, the wealth income ratio has typically fallen in a narrow interval between 4 and 5. However, the ratio briefly rose above 6 in 1999 during the dot.com bubble and broke that barrier again during 2005–2007," the report states.
Using information from the U.S. Federal Reserve Board, Credit Suisse offers a graph depicting the rise and fall of the ratio of wealth to disposable income in the United States from 1900 to the present.
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This chart from Credit Suisse's Global Wealth report graphs the ratio of wealth to disposable household income in the United States from 1900 to present. According to Credit Suisse, inequality is the highest its been in the United States since the Great Depression. (CC/Credit Suisse)
"[Inequality] dropped sharply into the 'normal band' following the financial crisis, but the decline has since been reversed, and the ratio is now at a recent record high level of 6.5, matched previously only during the Great Depression."
So prior to the Great Depression, the ratio of wealth to disposable household income was 7/1. Prior to the dot-com bust, 6/1. Today, the ratio is at 6.5/1, the highest since the early 1930's.
"This is a worrying signal given that abnormally high wealth income ratios have always signaled recession in the past," the bank wrote.
