The 5% Recovery: Why Most Americans Are Still in Recession

Mark Lennihan/AP How strong the economic recovery has been since the Great Recession ended in 2009 probably depends on viewpoint. For those in the top 5 percent of wealth, the recovery has been pretty good. As for the other 95 percent, well ... maybe not so much. Post-financial crisis wealth disparity has been well-chronicled. Federal Reserve governor Sarah B. Raskin drew widespread attention with a speech in April that showed how poorly the lower income levels have fared during the recovery, particularly because those demographics have their wealth concentrated in housing and are hit far more severely by falling prices. The unemployed in lower income groups also take a hit because they have a more difficult time finding jobs that pay at a rate commensurate with the positions they lost.

Finally, history has shown that highly accommodative monetary policy widens income disparity by awarding speculators and penalizing savers. While the Standard & Poor's 500 (^GSPC) is up nearly 150 percent since the March 2009 lows, that's most helped those heavily invested in stocks. The University of California Berkeley has produced some seminal research on this topic. But a series of charts, put together by Charles Hugh Smith at oftwominds.com, really helps put the sharply skewed recovery into perspective. He uses a handful of metrics to show that, despite the climb in gross domestic product and other data points, the recovery has not made its way through the economy. Those points are: Full-time employees as a percentage of the population; median household income (down 7.2 percent); real personal income less transfer receipts (government payments); and overall income disparity, which has yawned over the past decade.