{"id":37995,"date":"2025-11-12T12:18:11","date_gmt":"2025-11-12T12:18:11","guid":{"rendered":"https:\/\/financialrush.com\/?p=37995"},"modified":"2025-11-12T12:18:11","modified_gmt":"2025-11-12T12:18:11","slug":"ai-stock-boom-widens-u-s-investing-wealth-gap","status":"publish","type":"post","link":"https:\/\/financialrush.com\/?p=37995","title":{"rendered":"AI stock boom widens U.S. investing wealth gap"},"content":{"rendered":"<p> \n<\/p>\n<div id=\"RegularArticle-ArticleBody-5\" data-module=\"ArticleBody\" data-test=\"articleBody-2\" data-analytics=\"RegularArticle-articleBody-5-2\"><span class=\"HighlightShare-hidden\" style=\"top:0;left:0\"\/><\/p>\n<div class=\"InlineImage-imageEmbed\" id=\"ArticleBody-InlineImage-108210212\" data-test=\"InlineImage\">\n<div class=\"InlineImage-wrapper\">\n<div>\n<p>Oscar Wong | Moment | Getty Images<\/p>\n<\/div>\n<\/div>\n<\/div>\n<div class=\"group\">\n<p>U.S. stocks have been on a tear in recent years, largely on the back of <a href=\"https:\/\/www.cnbc.com\/2025\/10\/21\/are-we-in-an-ai-bubble.html\">euphoria around artificial intelligence<\/a>. But not everyone has participated in the runup: Stock wealth has largely <a href=\"https:\/\/www.cnbc.com\/2025\/11\/11\/stocks-are-buoying-wealthy-sentiment-a-labor-market-break-could-end-that.html\">accrued<\/a> to the wealthiest U.S. households.<\/p>\n<p>Even with recent choppiness, the <span class=\"QuoteInBody-quoteNameContainer\" data-test=\"QuoteInBody\" id=\"RegularArticle-QuoteInBody-3\"><a href=\"https:\/\/www.cnbc.com\/quotes\/.SPX\/\">S&amp;P 500<\/a><span class=\"QuoteInBody-inlineButton\"><span class=\"AddToWatchlistButton-watchlistContainer\" id=\"-WatchlistDropdown\" data-analytics-id=\"-WatchlistDropdown\"><button class=\"AddToWatchlistButton-watchlistButton\" aria-label=\"Add To Watchlist\" data-testid=\"dropdown-btn\"><span class=\"AddToWatchlistButton-addWatchListFromTag\"\/><\/button><\/span><\/span><\/span> U.S. stock index is up about 16% over the past year. Total wealth from publicly traded stocks has risen by $8 trillion or so during that time, said Mark Zandi, chief economist at Moody&#8217;s.<\/p>\n<\/div>\n<div class=\"group\">\n<div class=\"RelatedContent-relatedContent\" id=\"RegularArticle-RelatedContent-1\">\n<div class=\"RelatedContent-container\">\n<div class=\"RelatedContent-nonCollapsibleContent\">\n<h2 id=\"read-more-cnbc-personal-finance-coverage\" class=\"RelatedContent-header\">Read more CNBC personal finance coverage<\/h2>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n<div class=\"group\">\n<p>The top 20% wealthiest U.S. households own nearly 93% of all stock \u2014 meaning they get the lion&#8217;s share of any stock market gains, according to calculations by Edward Nathan Wolff, an economics professor at New York University who studies income and wealth distribution.<\/p>\n<p>&#8220;Stock ownership is still heavily concentrated among the rich \u2014 the very rich, in fact \u2014 and poor families have basically been left out of the picture,&#8221; Wolff said.<\/p>\n<p>&#8220;As the stock market goes up, it really widens the wealth and income gap,&#8221; Wolff said. &#8220;It&#8217;s a big part of the inequality story.&#8221;<\/p>\n<\/div>\n<h2 id=\"a-huge-huge-gap\" class=\"ArticleBody-subtitle\"><a id=\"headline0\"\/>&#8216;A huge, huge gap&#8217;<\/h2>\n<div class=\"group\">\n<p>Of course, this isn&#8217;t to suggest that AI is the lone reason the stock market has risen, or that it alone is the source of the U.S. wealth gap.<\/p>\n<p>But it exacerbates other tensions at play, and has implications for politics and the broad U.S. economy, Zandi said.<\/p>\n<p>For one, a widening gulf between the haves and have-nots could create more &#8220;political fracturing,&#8221; making it harder to reach consensus, he said.<\/p>\n<p>&#8220;They have different needs and perspectives, and therefore policy desires,&#8221; Zandi said. &#8220;You can feel it in our politics today \u2014 even in our ability to keep the government open.&#8221;<\/p>\n<\/div>\n<div role=\"region\" aria-labelledby=\"Placeholder-ArticleBody-Video-108223865\">\n<div role=\"button\" tabindex=\"0\" id=\"Placeholder-ArticleBody-Video-108223865\" class=\"PlaceHolder-wrapper\" data-vilynx-id=\"7000395108\" data-test=\"VideoPlaceHolder\">\n<div class=\"InlineVideo-videoEmbed\" id=\"InlineVideo-0\" data-test=\"InlineVideo\">\n<div class=\"InlineVideo-wrapper\">\n<div class=\"InlineVideo-inlineThumbnailContainer\"><span class=\"InlineVideo-videoButton\"\/><span\/><\/div>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n<div class=\"group\">\n<p>The dynamic also fuels a bifurcation in spending, he said. The U.S. economy is more reliant on the spending of a relatively small group \u2014 the wealthy \u2014 leaving it more vulnerable if &#8220;something were not to stick to script for that group,&#8221; Zandi said.<\/p>\n<p>The top 1% owned half \u2014 or $25.6 trillion \u2014 of the total $51.2 trillion of corporate stock and mutual fund shares in the second quarter of 2025, according to the most recent Federal Reserve <a href=\"https:\/\/www.federalreserve.gov\/releases\/z1\/dataviz\/dfa\/distribute\/chart\/#quarter:143;series:Corporate%20equities%20and%20mutual%20fund%20shares;demographic:networth;population:all;units:levels;range:2010.2,2025.2\" target=\"_blank\">data<\/a>. The average person in the top 1% has almost $37 million in net assets, Wolff said.<\/p>\n<p>Meanwhile, the bottom 50% of households collectively held just 1% \u2014 or $540 billion \u2014 of that stock and mutual fund wealth.<\/p>\n<p>&#8220;There&#8217;s a huge, huge gap,&#8221; said John Sabelhaus, senior fellow of economic studies at the Urban-Brookings Tax Policy Center and a former research official at the Board of Governors of the Federal Reserve System.<\/p>\n<p>&#8220;Stock ownership is very low at the bottom of the income distribution,&#8221; he said.<\/p>\n<\/div>\n<h2 id=\"ai-isnt-the-only-boom-affecting-wealth\" class=\"ArticleBody-subtitle\"><a id=\"headline1\"\/>AI isn&#8217;t the only boom affecting wealth<\/h2>\n<div class=\"group\">\n<p>Much of stocks&#8217; growth is attributable to the so-called <a href=\"https:\/\/www.cnbc.com\/2025\/10\/29\/powell-says-ai-different-from-dotcom-bubble-major-source-gdp-growth.html\">AI boom<\/a>.<\/p>\n<p>The stocks of companies tied to artificial intelligence have accounted for roughly 75% of S&amp;P 500 returns since ChatGPT launched in November 2022, Michael Cembalest, chairman of market and investment strategy for J.P. Morgan Asset Management, <a href=\"https:\/\/am.jpmorgan.com\/content\/dam\/jpm-am-aem\/global\/en\/insights\/eye-on-the-market\/the-blob-amv.pdf\" target=\"_blank\">wrote<\/a> on Sept. 24.<\/p>\n<p>&#8220;AI stocks have gone stratospheric over the last three years,&#8221; Zandi said.<\/p>\n<\/div>\n<div class=\"group\">\n<p>Even when lower-wealth households have stock, their holdings are relatively small, Wolff said.<\/p>\n<p>For example, about a fifth of the poorest 20% of households own stock, he said. But just 5% own $10,000 or more, compared to nearly all of the richest households, he said.<\/p>\n<p>Wolff analyzed data from the Federal Reserve&#8217;s triennial Survey of Consumer Finances. The analysis includes direct stock ownership, as well as stock held indirectly in sources like workplace retirement plans.<\/p>\n<p>Households with less wealth don&#8217;t have the resources to save, and so can&#8217;t afford to buy as much stock, according to financial experts.<\/p>\n<p>Meanwhile, the wealthy have more discretionary income and financial resources, and can afford to take more risk with their savings and investments, they said.<\/p>\n<\/div>\n<div role=\"region\" aria-labelledby=\"Placeholder-ArticleBody-Video-108217823\">\n<div role=\"button\" tabindex=\"0\" id=\"Placeholder-ArticleBody-Video-108217823\" class=\"PlaceHolder-wrapper\" data-vilynx-id=\"7000393740\" data-test=\"VideoPlaceHolder\">\n<div class=\"InlineVideo-videoEmbed\" id=\"InlineVideo-0\" data-test=\"InlineVideo\">\n<div class=\"InlineVideo-wrapper\">\n<div class=\"InlineVideo-inlineThumbnailContainer\"><img decoding=\"async\" class=\"InlineVideo-videoThumbnail\" src=\"https:\/\/image.cnbcfm.com\/api\/v1\/image\/108199452-1758042135344-gettyimages-2235766893-_d1_5692_fucrsiu3.jpeg?v=1761674882&amp;w=750&amp;h=422&amp;vtcrop=y\" alt=\"How Fed rate cuts affect your wealth\"\/><span class=\"InlineVideo-videoButton\"\/><span\/><\/div>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n<div class=\"group\">\n<p>Despite the AI-driven stock market boom, the wealth gap has actually decreased for the middle class relative to the richest households due to a runup in housing prices, Wolff said.<\/p>\n<p>&#8220;The housing market, at least until recently, has been booming,&#8221; he said.<\/p>\n<p>For example, the 50th to 90th percentiles by wealth own about half \u2014 or, $23 trillion \u2014 of total real estate, according to Fed <a href=\"https:\/\/www.federalreserve.gov\/releases\/z1\/dataviz\/dfa\/distribute\/chart\/#quarter:143;series:Real%20estate;demographic:networth;population:1,3,5,7,9;units:levels;range:2010.2,2025.2\" target=\"_blank\">data<\/a>.<\/p>\n<p>Overall stock ownership among lower earners has increased slightly in recent years, a dynamic that tends to happen when stocks perform well, said Sabelhaus, citing Fed data.<\/p>\n<p>There&#8217;s also been a push to make it easier for consumers of all wealth levels to invest, as apps and certain investments have lowered the barrier to entry.<\/p>\n<\/div>\n<h2 id=\"double-edged-sword-of-stock-ownership\" class=\"ArticleBody-subtitle\"><a id=\"headline2\"\/>&#8216;Double-edged sword&#8217; of stock ownership<\/h2>\n<div class=\"group\">\n<p>And stock ownership is &#8220;always a double-edged sword,&#8221; said Sabelhaus of the Urban-Brookings Tax Policy Center. While the stock market&#8217;s value has historically increased over long periods of time, the wealthy bear more of the shorter-term financial risk if the market falls, he said.<\/p>\n<p>Indeed, if AI demand were to &#8220;falter,&#8221; &#8220;we doubt non-tech firms would rescue the market,&#8221; James Reilly, senior markets economist at Capital Economics, wrote in a research note on Nov. 4.<\/p>\n<p>Certain households, like those carrying a lot of high-interest debt or saving to buy a home, may be better off directing their money toward interest payments or a down payment instead of the stock market to minimize financial losses in the short term, Sabelhaus said.<\/p>\n<p>&#8220;If someone said, &#8216;I make $50,000 a year, I have student loans and credit card debt, should I be investing in AI or crypto?&#8217; I&#8217;d probably say no,&#8221; he said.<\/p>\n<p>&#8220;I think in general it&#8217;s fair to say, if you can take on the risk, then you should take on that risk to enjoy the higher rate of return,&#8221; he added. &#8220;But it&#8217;s a trade-off.&#8221;<\/p>\n<\/div>\n<\/div>\n\n<br \/><a href=\"https:\/\/www.cnbc.com\/2025\/11\/12\/ai-stock-boom-wealth-gap.html\">Source link <\/a><\/p>\n","protected":false},"excerpt":{"rendered":"Oscar Wong | Moment | Getty Images U.S. stocks have been on a tear in recent years, largely&hellip;\n","protected":false},"author":3,"featured_media":37996,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[11],"tags":[],"class_list":["post-37995","post","type-post","status-publish","format-standard","has-post-thumbnail","category-investing","cs-entry","cs-video-wrap"],"_links":{"self":[{"href":"https:\/\/financialrush.com\/index.php?rest_route=\/wp\/v2\/posts\/37995","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/financialrush.com\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/financialrush.com\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/financialrush.com\/index.php?rest_route=\/wp\/v2\/users\/3"}],"replies":[{"embeddable":true,"href":"https:\/\/financialrush.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=37995"}],"version-history":[{"count":0,"href":"https:\/\/financialrush.com\/index.php?rest_route=\/wp\/v2\/posts\/37995\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/financialrush.com\/index.php?rest_route=\/wp\/v2\/media\/37996"}],"wp:attachment":[{"href":"https:\/\/financialrush.com\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=37995"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/financialrush.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=37995"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/financialrush.com\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=37995"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}