The stocks will be fine. If the whole world burns — I don’t know why I say “if,” as though it’s not already ablaze — US equities will somehow come away from the inferno unblemished.

That’s not quite what Americans polled by the New York Fed for the latest edition of the bank’s monthly consumer survey said, when queried on the outlook for Wall Street, but it’ll work as a humorous encapsulation.

As the figure below shows, stock price expectations jumped. The mean perceived probability that equities will be higher in the year ahead rose to 40.5%, the best reading since May of 2021.

Somewhat amusingly, the “high school or less” cohort’s now more optimistic about the outlook for the equities they don’t own than the “some college” demographic (not that those respondents own many stocks either). By age, respondents younger than 40 were the most optimistic.

Frankly, that was the only data point that stood out in the release. Inflation expectations receded at the one-year horizon, but only by a tenth of a percent (to 3.2%) and were unchanged at the three-year point. They moved up to 3% from 2.8% at the five-year horizon, but that’s a new series (inaugurated in January of 2022) and traders anyway don’t pay much attention to the NY Fed survey.

It’s worth noting — I guess — that the share of respondents who anticipate a similar or better financial situation a year from now hit 78.1%. That was likewise the highest in about three years, and presumably had something to do with the ostensibly rosy outlook for equities. US household net worth rose more than $5 trillion during the first quarter, thanks in no small part to the rally on Wall Street.

As the figure (above) shows, $3.83 trillion of the Q1 wealth increase was attributable to rising stock prices. If you round up, it was the second straight quarter during which the value of equities held by households rose by $4 trillion.

The (sad) punchline is always the same: Most Americans don’t own that many stocks. As I was keen to point out in the latest Weekly, even the fortunate among you only own “a lot” of stocks by comparison to people who don’t own any at all. As a share of the equity market, most of you (“us,” to include myself) own just a few stocks, and that’s on “rich” days.

As of the latest Fed update, the top 1% of society owned 49.4% of corporate equities and mutual fund shares in America. When you expand the sample to include the top 10%, that share rises to 87%, leaving a “whole” 13% for everyone else.