[pushtheenvelope]

Why is it not sustainable that household wealth is > 500% of GDP?

In the parlance of company finances, GDP is like revenue and wealth is the valuation representing the present value of all future profits. So, it seems fine to me that the present value of future profits of the US is 5x the current revenue.

I'm seeking to understand where this analogy may break down. Thanks :)

[WarDores]

Traditionally, anything above ~350% has indicated a bubble. With the housing bubble, we saw a peak of 473%, and the dot-com bubble was 429% at its peak. Essentially, yes, wealth will be a multiple of GDP, but the multiple has been fairly constant historically, and it's diverging rapidly now. So either we're in an era where assets are significantly more valuable (and I'm not sure there's a good case for that given the multiplier), or we're in an asset bubble.

[lixtra]

See https://www.forbes.com/sites/jessecolombo/2018/08/24/u-s-hou... for a more elaborate treatise of the subject.