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By David Urani

So we got an employment report that was better than anticipated, with 175k jobs being added in what really could have been a worse month with the weather and all. And now the ball goes into Janet Yellen's court as she and the Fed decide whether to stay on course with their QE tapering schedule.

If you've ever wondered why the Fed has been reluctant to do so until just late last year, consider the affect the rising market has had on household net worth. The Fed reported yesterday that total U.S. household net worth rose by $3 trillion in Q4 to a new record high $80.7 trillion. Of the $3.0 trillion in additional asset value gains, $2.2 trillion came from equities, pension and mutual funds. And when adding together the total asset values of household equities, pensions and mutual funds and dividing it by total household assets, one sees that the percentage those items account for has been rising.

In fact, these financial market gains now account for 43% of total household assets, and that percentage was only higher in late 1999 and early 2000 during the tech bubble. Of course, later in that decade stock market assets came down as a percentage of total assets not only because those tech stocks crashed, but also because of the bubbling in real estate values. But in 2000 the value of real estate as a proportion of household assets was just slightly higher than it is now (23.7% of total assets in 1Q 2000 versus 23.3% now).

That's not to say that stocks are currently in a bubble, but it goes to show that the markets have become an increasingly influential in U.S. families' financial strength. And that was part of the Fed's goal, as Ben Bernanke made it clearly known that he wished to increase asset values. But one also should consider that it's the rich folks that see the most benefit from stock gains. In the meantime, we need to make sure to keep the exuberance in the stock market in check, as its control over household finances is rising and it can bring U.S. household net worth down as quickly as it lifted it. And that's something that Mrs. Yellen is well aware of. Better to taper now than to let it get out of hand.