The U.S. economy this summer made a significant rebound from the 2008 financial crisis as the booming stock market and rising home values caused household wealth to spike 2.6 percent to $77.3 trillion, according to the Federal Reserve.
The Fed's economic report published Monday shows mortgage debt rose approximately 1 percent during the third quarter from July to the end of September, expanding for the first time since the start of 2008 as more Americans trust in the recovery of the housing market. Consumer credit also rose at an annual adjusted rate of 6 percent, approximately the same increase as in the second quarter, showing more Americans have been willing to take out loans on large purchases.
Americans wealthy enough to own stocks and mutual funds benefited from a prospering market, adding $917 billion to the net household worth during the third quarter. Rising home values also added $428 billion to the wealth of homeowners during the third quarter, according to the Fed.
Each of the stock indexes reached record highs in November and the market remains bullish. Recent reports from the Standard & Poor's/Case-Shiller home-price index and two government agencies also show the housing market is steadily recovering.
Whether the Fed will decide to raise interest rates is a major factor economists consider when predicting the duration of this economic growth. Outgoing Fed Chairman Ben Bernanke indicated on Nov. 20 that the interest rates could remain low for the near future unless unemployment and inflation worsen.