Growth
Americans’ net worth still has to rise an additional 21 percent just to get back to its pre-recession peak of $65.9 trillion. That illustrates Americans’ vast loss of wealth from the worst downturn since the 1930s. Growth in stock portfolios delivered the biggest lift to net worth in the October-to-December period. The value of stocks rose by nearly 4 percent to $7.7 trillion. Higher home prices helped a bit. The value of real-estate holdings edged up 0.2 percent.

The plunge
During the recession, which began in December 2007, household net worth had plunged as low as $48.5 trillion in the first quarter of 2009. Stock holdings and home values nose-dived. As their net worth evaporated, Americans felt less inclined to spend. For all of last year, consumer spending dropped 0.6 percent. This year the economy and financial conditions slowly recover; consumer spending is projected to grow around a modest 2.2 percent, according to the National Association for Business Economics.

The climb
In 1983, when the economy was recovering from the 1981-82 recession, consumer spending surged 5.7 percent. Unlike past rebounds led by ordinary shoppers, this one so far has been driven by spending from businesses, foreigners and government stimulus. Consumers have been spending more lately, but they remain cautious. “It would take a string of increases of a size that they believe can continue and that they can have faith in for consumers to boost their spending,” said Scott Hoyt, director of consumer economics at Moody’s Economy.com. Each dollar increase in household wealth translates into roughly three to four cents of consumer spending over two years, Hoyt said. That’s not much.

Retirement accounts
Holders of 401(k) retirement accounts have recovered somewhat from the walloping they took in the meltdown. But even with continued contributions to those accounts, many are still struggling. Average account balances for 401(k) contributors ages 45 and older remained 2 to 3 percent lower at the end of December than at the end of 2007, according to the Employee Benefit Research Institute.

Diminished worth
Concern about their diminished net worth also led many Americans to reduce their borrowing last year. Household debt, including mortgages, credit cards, auto and student loans, contracted at an annual rate of 1.75 percent in 2009, the Fed report said. It was the first annual decline on record.

Back to normal
Not until 2012 does Hoyt think household wealth will return to its pre-recession levels. A severe setback to the economy could delay it further, he added.

Who is the richest man of all?
His name is Carlos Slim and he is a 70 year old communications company man from Mexico. Slim beat Bill Gates and Warren Buffett for the top spot on Forbes magazine’s annual list of billionaires, becoming the first person from outside the U.S. to lead the rankings in 16 years. That’s quite an achievement.

How much money does he have?
The net worth of Slim, who built a telecommunications empire after buying Mexico’s state-run phone monopoly two decades ago, rose $18.5 billion to $53.5 billion. Gates, 54, chairman of Microsoft Corp., fell to second as his net worth increased $13 billion to $53 billion. Buffett, 79, chairman of Berkshire Hathaway Inc., was third with $47 billion, a rise of $10 billion. More than 80 percent of Slim’s holdings are held in five public stocks, and his net worth is a reflection of how well those stocks are doing.

Change at the top
Slim is the first person other than Gates, last year’s richest person, or Buffett, to top the list since 1994, which was also the last time a billionaire from outside the U.S. led the ranking: Japanese real estate tycoon Yoshiaki Tsutsumi. “We’ve been watching Slim for a while and wondering when the stars would align and he would take over,” Forbes senior editor Luisa Kroll said in an interview yesterday.

How much is 53.5 billion dollars?
It’s a lot of money and it would fill a lot of space. Here’s a picture for you. If $50 in dollar notes billion was spread over a football field the players would be buried in about 30 feet of money.

Where are Gates and Buffet?
Don’t worry about them. They are still up there in the stars. Gates, who is 54 and the chairman of the Microsoft Corporation, came second by raking in a measly $53 billion and Buffett, 79, the chairman of Berkshire Hathaway Inc., was third with $47 billion. For the middle class among us who pull in anything up to a couple of hundred thousand dollars a year, billions are astronomical amounts of money. For the millionaires among us, a billion is still light years away.

It is do-able
The lesson is that it is possible to make billions. Slim, Gates, Buffet and many others in many countries around the world have done it, so it means that it can be done, right?