The financial crisis permanently damaged the U.S. economy, costing around $70,000 in lost income for every American.
Ten years after the financial crisis peaked in 2008, the U.S. economy remains significantly smaller than it should be based on its pre-crisis growth trend, according to a study published Monday by the Federal Reserve Bank of San Francisco.
“One possible reason lies in the large losses in the economy’s productive capacity following the financial crisis,” Fed economists Regis Barnichon, Christian Matthes, and Alexander Ziegenbein write. “The size of those losses suggests that the level of output is unlikely to revert to its pre-crisis trend level. This represents a lifetime present-value income loss of about $70,000 for every American.”