U. S. SECURITIES AND EXCHANGE COMMISSION
                        WASHINGTON, D.C.  20549
                        ________________________

                             FORM 10-QSB

(Mark One)

_X_  QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES
     EXCHANGE ACT OF 1934

            For the Quarterly period ended:  June 30, 1997

___ TRANSITION REPORT UNDER SECTION 13 OR 15 (d) OF THE
    SECURITIES EXCHANGE ACT

          For the transition period from _______ to _______.

                  Commission file number:  0-19154.

               AMERICAN ASSET MANAGEMENT CORPORATION
(Exact name of small business issuer as specified in its charter)

          NEW JERSEY                              22-2902677
(State or other jurisdiction of               (I.R.S. Employer
 incorporation or organization)               Identification No.)

 150 Morristown Road, Suite 108, Bernardsville, New Jersey 07924
              (Address of principal executive offices)

Issuer's telephone number, including area code:  (908) 766-1701


       (Former name, former address and former fiscal year,
                    if changed since last report)

Check whether the issuer (1) filed all reports required to be
filed by Section 13 or 15 (d) of the Exchange Act during the past
12 months (or for such shorter period that the registrant was
required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days.   YES___  NO_X_.

               APPLICABLE ONLY TO CORPORATE ISSUERS

State the number of shares outstanding of each of the issuer's
classes of common equity, as of the latest practicable date:  As
of December 1, 1997 there were 936,119 shares outstanding of the
issuer's no par value common stock.

Transitional Small Business Disclosure Format (check one): 
YES___   NO_X_


<PAGE>
                 PART I - FINANCIAL INFORMATION
Item 1.  Financial Statements

      AMERICAN ASSET MANAGEMENT CORPORATION AND SUBSIDIARIES
                   CONSOLIDATED BALANCE SHEETS
                           (Unaudited)
_________________________________________________________________
                                       June 30,     December 31,
                                      ___1997___     ____1996____
_____________ASSETS________________
Cash & cash equivalents              $  200,380       $  220,733
Mortgage loans receivable             3,096,114        1,336,875
Notes receivable                         26,539           28,655
Prepaid and other current assets        144,641           60,294

     Total current assets             3,467,674        1,646,557

Land and development costs              991,786        1,534,603
Furniture & equipment, at cost,
  less accumulated depreciation          14,606           14,933
Other assets                              1,203            1,204
Commission Advances                          -             9,550
     Total assets                     4,475,269        3,206,847

__LIABILITIES AND STOCKHOLDERS' EQUITY__
Current liabilities:
 Accounts payable & accrued expenses $  334,625       $  379,014
 Deferred income                         26,013           23,349
 Liability for land development          68,693          134,386 
 Loans payable                          127,392          192,491
 Lot deposits                            75,000           91,000
 Warehouse loans payable              2,994,529        1,310,128
 Mortgage payable                       155,706          429,238

    Total current liabilities         3,781,958        2,559,606

Stockholders' equity:
 Preferred stock subscribed, no par 
 value; 58,750 shares-5% Non-voting
 Series A Cumulative Convertible 
 aggregate liquidation value $587,500   637,500          565,000
 Preferred Stock Dividend             (  14,507)             -
 Common stock, no par value; 
 10,000,000 shares authorized; 
 936,119 shares issued and 
 outstanding                          2,449,325        2,449,325
Additional paid-in capital              231,207          231,207
Accumulated deficit                  (2,610,214)      (2,598,291)

     Total stockholders' equity         693,311          647,241
     Total liabilities and
     stockholders' equity             4,475,269        3,206,847
   See accompanying Notes to Consolidated Financial Statements.
<PAGE>                             -2-

      AMERICAN ASSET MANAGEMENT CORPORATION AND SUBSIDIARIES
              CONSOLIDATED STATEMENTS OF OPERATIONS
                           (Unaudited)
_________________________________________________________________

                         For the Three Months|For the Six Months
                         __Ended  June 30,___|__Ended June 30,___
                         __1997__   __1996___|__1997__   __1996__

Revenues:
 Mtg. origination fees  $385,968   $ 54,305  $  718,875 $ 103,343
 Application fees         26,648     16,495      67,653    21,820
 Mtg. interest income    101,743      5,158     146,751    16,090
 Income from land sold   253,000         -      505,500        -

    Total revenues       767,359     75,958   1,438,779   142,253

Selling, general 
and administrative
expenses:
 Salaries & benefits     124,158    116,182     248,830   201,234
 Commissions & 
  related expenses       170,437     18,148     313,049    27,406
 Other expenses          191,485     76,628     346,816   133,450
 Cost of land sold       285,635         -      543,135        -

  Total selling, 
  general and 
  administrative
  expenses               771,715    210,958   1,451,830   362,090


Income/(loss) 
 from operations        (  4,357)  (135,000)  ( 13,051) (220,837)

Other income               1,053        588       1,128     1,165

Income before provisions
for St. income taxes    (  3,304)  (134,412)  ( 11,923) (219,672)

Provision for State 
 income taxes                 -          -          -         -

Net income/(loss)      $(  3,304) $(134,412)  ( 11,923) (219,672)

Net income/(loss)      $  (0.003) $   (0.14)  $  (0.01) $  (0.23) 
 per share

Weighted avg. no.
 of shares of common
 stock outstanding       936,119    936,119     936,119   936,119

   See accompanying Notes to Consolidated Financial Statements.
<PAGE>                         -3-
     AMERICAN ASSET MANAGEMENT CORPORATION AND SUBSIDIARIES
               CONSOLIDATED STATEMENTS OF CASH FLOWS
                            (Unaudited)
_________________________________________________________________
                          For the Three Months|For the Six Months
                           6/30/97    6/30/96 | 6/30/97   6/30/96 
CASH FLOWS FROM 
OPERATING ACTIVITIES
  Net loss(income)       $  (3,304)$(134,412)$ (11,923)$(219,672)
  Adjustments to 
   reconcile net loss
   to net cash used in 
   operating activities:
   Depreciation 
    & amortization             163       997       327     4,456
CHANGES IN ASSETS 
    & LIABILITIES:
 (Increase)decrease in:
  Notes receivable           1,140      (589)    2,116    (1,165)
  Mtg. loans receivable   (102,795) ( 97,611)(1,759,239) 560,815 
  Fees & Int. receivable                     
   prepaid & other assets  (14,729)   10,958   (74,797)    9,232 
  Increase(Decrease) in:
   Accounts payable, 
    accrued expenses,                         
    commissions payable                     
    & deferred income      (90,522)   (3,915) (107,418) (113,101)
  Warehouse line payable    67,134    90,151 1,684,401  (549,599)
NET CASH (USED IN)
 PROVIDED BY OPERATING
  ACTIVITIES              (142,913) (134,421) (266,533) (309,034)

CASH FLOWS FROM 
 INVESTING ACTIVITIES
  Lot deposits             (16,000)   (4,000)   (16,000)  62,000
  Increase in land & 
   development costs       285,634    (2,994)   542,818  (15,623)
  Purchase of fixed assets       -    (1,966)         -   (4,905)
Net Cash (Used In) Provided
By Investing Activities    269,634    (8,960)   526,818   41,472
CASH FLOWS FROM 
   FINANCING ACTIVITIES 
 Purchase of pref'd stock   72,500        -      72,500       -
 Dividends                 ( 7,445)  133,557    (14,507)      - 
 Increase in Mtg. Payable  (73,483)       -    (273,535)      -
 Loans payable             (35,423)  133,557    (65,099)  13,093
NET CASH (USED IN) PROVIDED
BY FINANCING ACTIVITIES    (43,851)  133,557   (280,638)  13,093

NET INCR/(DECR) IN CASH     82,870   (9,824)   ( 20,353)(254,469)
CASH @ BEGINNING OF PERIOD 117,510    29,709    220,733  274,354
CASH @ END OF PERIOD     $ 200,380  $ 19,885    200,380   19,885
   See accompanying Notes to Consolidated Financial Statements.
<PAGE>                        -4-



      AMERICAN ASSET MANAGEMENT CORPORATION AND SUBSIDIARIES
 
            NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                          (Unaudited)
_________________________________________________________________

1.  BACKGROUND AND BASIS OF FINANCIAL STATEMENT PRESENTATION

     The accompanying consolidated financial statements of
American Asset Management Corporation and subsidiaries (the
"Company") are unaudited.  In the opinion of management, all
adjustments and intercompany eliminations necessary for a fair
presentation of the results of operations have been made and were
of a normal recurring nature.  The consolidated financial
statements of the Company include the operations of both
wholly-owned subsidiaries, Capital Financial Corp. and American
Asset Development Corporation.  The Company's operations consist
of specialized and mortgage banking services and real estate
development.  These interim consolidated financial statements
should be read in conjunction with the consolidated financial
statements and related notes thereto contained in the Company's
1996 Annual Report on Form 10-KSB.  The results of the three
months ended June 30, 1997 are not necessarily indicative of the
results of the full year.

2.  REVENUE AND EXPENSE RECOGNITION

     Application fees and commitment fees are recorded when
received and other fee income is recorded when loans close. 
Expenses are recognized as they are incurred.

3.  NET INCOME/(LOSS) PER COMMON SHARE

     Net income/(loss) per common share is based on the weighted
average number of shares of Common Stock outstanding.  No effect
has been given to shares issuable upon exercise of outstanding
warrants as the effect would be antidilutive.

4.  RECLASSIFICATIONS

     Certain prior year amounts have been reclassified to conform
with the current year's presentation.





                              -5-
<PAGE>



Item 2.

     AMERICAN ASSET MANAGEMENT CORPORATION AND SUBSIDIARIES

              MANAGEMENT'S DISCUSSION AND ANALYSIS
                      OR PLAN OF OPERATION
_________________________________________________________________

RESULTS OF OPERATIONS

Three Months Ended June 30, 1997 Compared to the Three Months
Ended June 30, 1996.

     Revenues for the three months ended June 30, 1997 and 1996
were $767,359 and $75,958 respectively.  The increase in the 1997
period of $691,401 was the result of an increase in
mortgage origination fees, application fees, mortgage interest
income and $253,000 in income from sold land, all of which were
generated by Capital Financial Corp., ("Capital") the Company's
wholly-owned mortgage banking subsidiary, except for land sold
which was generated by American Asset Development Corp.  The
increase in application fee revenue reflects an increase in the
number of mortgage applications received.  Loans typically close
approximately 90 days from the date of application.  The Company
is continuing its efforts to attract experienced loan originators
with established business relationships with realtors, attorneys
and accountants as sources of referrals for mortgage applications
in its service area.  During the three month period ended June
30, 1997, the Company received 133 mortgage loan applications for
processing from borrowers seeking loans aggregating approximately
$26,430,882 as compared to 72 applications in an aggregate amount
of approximately $11,727,750 in the comparable 1996 period.  The
Company closed 128 loans aggregating approximately $20,866,333 in
the three months ended June 30, 1997 compared to 19 loans closed
aggregating approximately $3,453,275 in the comparable 1996
period.

     Total selling, general and administrative expenses ("SG&A")
for the three months ended June 30, 1997 increased $560,757 to
$771,715 from $210,958 in the comparable 1996 period.  The
increased SG&A in the 1997 quarter was primarily due to
increased employee compensation costs, other expenses and by
higher commission expenses.  As a percentage of revenues, SG&A
was 100.57% in the current period compared to 278% in the 1996
period.

     As a result of the foregoing, the Company's net loss for the
three months ended June 30, 1997 was $3,304 or $0.003 per share,
compared to a net loss of $134,412 or $0.14 per share for the
comparable 1996 period.  The decreased loss in the 1997 period
compared to the comparable 1996 period is attributable to
increased revenues without a commensurate increase in expenses as
discussed above.  
<PAGE>                           -6-
Six Months Ended June 30, 1997 Compared to the Six Months Ended
June 30, 1996.

     Revenues for the six months ended June 30, 1997 were
$1,438,779 compared to $141,253 for the comparable 1996 period. 
The $1,297,526 increase was the result of an increase in mortgage
origination fees, application fees and in mortgage interest
income.  The increase in mortgage origination fees and
application fees was the result of the Company's inclusion on a
mortgage network system of mortgage bankers which increased the
Company's mortgage originations during the six month period.  The
increase in mortgage interest income was a result of the Company
utilizing it's warehouse credit line to provide borrowers with
construction to permanent mortgage loans, at interest rates
higher than those charged to the Company by its warehouse credit
line lender.  During the six months ended June 30, 1997, the
Company received 311 mortgage loan applications for processing
from borrowers seeking loans aggregating approximately
$57,160,833 compared to 93 loan applications aggregating
approximately $15,014,950 received in the comparable period in
1996.  The Company closed 231 loans aggregating approximately
$37,611,646 in the six months ended June 30, 1997, compared to 32
loans closed aggregating approximately $5,904,775 in the
comparable 1996 period. 

     Total SG&A expenses for the six months ended June 30, 1997
increased by $5,904,775 to $1,451,830 for $362,090 in the
comparable 1996 period, primarily as a result of increased
salaries and benefits, increased commission and related
expenses and other expenses related to mortgage processing such
as credit report and appraisal fees.  In addition, there was
$253,000 in costs for land sold.  As a result, SG&A, expressed as
a percentage of revenues, decreased to 100.91% in the 1997 period
from 256% in the 1996 period.  The Company is actively seeking
additional experienced loan officers in addition to outside
sources of mortgage originations, to complement its present
sales, management and support staff.

     As a result of the foregoing, the Company's net loss for the
six months ended June 30, 1997 was $11,923 or $0.01 per share,
compared to a net loss of $219,672 or $0.23 per share for the
comparable 1996 period.  The decreased loss in the 1997 period is
attributable to expenses increasing at a lesser rate than the
increase in revenues.


LIQUIDITY AND CAPITAL RESOURCES

     As of June 30, 1997, the Company had cash and cash
equivalents of $200,380 compared to $220,733 at December 31,
1996.  The decrease was primarily attributable to cash used in
operating activities.  Cash used in operating activities was the

<PAGE>                         -7- 
net result of the net loss for the six month period ended June
30, 1997, increases in mortgage loans receivable, increases in
accounts payable and accrued expenses, commissions payable,
warehouse loan payable, increases in loans payable to others,
decreases in fees and interest receivable, loans payable to
officers/affiliates and deferred income, which were partially
offset by cash provided by depreciation and amortization,
increases in notes receivable and prepaid and other current
assets.  Cash used in investing activities included increased
land and development costs and purchase of office equipment.

     Although the increase in mortgage applications and closings
during the period ending June 30, 1997 as compared to the period
ending June 30, 1996 are having a positive effect on the
Company's cash flow, there can be no assurance that the number of
future closings will be sufficient to offset expenses.  Loans in
process have increased from 138 loans with an aggregate principal
amount of approximately $21,838,318 as of December 31, 1996 to
143 loans aggregating approximately $30,274,617 as of June 30,
1997.

     In May 1995, the Company received a $5,000,000 warehouse
line of credit from a mortgage warehouse lender which enables the
Company to borrow funds secured by residential mortgage loans
which will be temporarily accumulated or warehoused and then
sold.  The Company continues to utilize the warehouse line of
credit in the daily operation of it's mortgage banking
subsidiary.

     In October 1996, the Company became a member of an
electronic network system ("Network") of thirty one mortgage
bankers which originate applications through a real estate broker
branch office system located throughout New Jersey.  The Company
has agreed to compensate the Network of originators with a
commission based on closed loans originated by the Network.  The
Company believes it is one of approximately twelve lenders which
offer mortgage products through this system.  There can be no
assurance the Company will be successful in this relationship as
it faces intense competition from the other lenders its competes
with for this business, many of which have greater resources and
experience than the Company.  As of December 1997, the Company
has 14 mortgage loans in process from the Network aggregating
approximately $3.4 million out of a total of 99 mortgage loans
aggregating approximately $21.5 million which are currently being
processed by the Company.

     In December 1996, the Company accepted a commitment issued
by a commercial bank for a construction mortgage financing line
of credit in the amount of $550,000 for use in the Company's real
estate development located in Hunterdon County, New Jersey, known
as Murray Hill Estates.  The loan provides a letter of credit in
the amount of $111,583 which the Company assigned and deposited

<PAGE>                         -8-
in escrow with municipal authorities during January 1997 to
guarantee the township adequate funds to complete the balance of
required site improvements on the property if the Company fails
to complete the required improvements.  As of December 1, 1997,
the Company has completed approximately 90% of all improvements
to the property and plans on completing the balance of the
required improvements during the fourth quarter of 1998, which
the Company estimates will cost approximately $35,000.  The
mortgage loan further provided $430,417 which was used to
refinance the mortgage loan which was on the property, funds to
complete the balance of required site improvements and provides
an interest reserve.  The loan matures on December 31, 1997,
except for the letter of credit which may be extended for
an additional one year term, unless the Company is notified at
least 60 days prior to its scheduled expiration date that the
bank will not allow the extension.  As of December 1, 1997 the
Company had not received notification from the bank that it will
not extend the letter of credit.  The mortgage loan is further
secured by the personal guarantees of the Company's President and
Executive Vice President.  During December 1997, the Company
requested that the term of this mortgage loan be extended one
year.  If the Company is not granted the extension, the loan will
have to be paid in full.  There can be no assurance that the
Company will be successful in obtaining the requested extension.
As of December 1, 1997, the Company is indebted to the commercial
bank for the mortgage loan on its subdivision in the amount of
approximately $157,000.

     As of December 1, 1997, the Company owns 7 unimproved
building lots within the subdivision of the property and has one
contract of sale pending in the amount of $125,000 of which it
has received total deposits of $75,000.

     In January 1997, the Company filed its maps with county
authorities on the subdivision located in Hunterdon County, New
Jersey.  In February, March and June 1997, the Company
transferred title to and received payment in full on 3 unimproved
building lots to 3 non-affiliates of the Company in the amount of
$97,500, $110,000 and $110,000 respectively.  Proceeds from these
sales were used to pay down mortgage debt owed to the commercial
bank and the balance provided working capital to the Company.  On
the first two of three lots sold, the Company arranged
construction financing through Capital and construction
management through an affiliate of the Company.  The homes were
completed during July 1997.

     In February 1995, the Company entered into a revised 
contract of sale for a lot included in the Property containing an
uninhabitable farmhouse and a fieldstone barn for $148,000, of
which payments of $10,000 were received.  At closing, the Company
received an additional $5,000 and agreed to provide the purchaser
a one-year interest only first mortgage in the principal amount

<PAGE>                            -9-
of $133,000 bearing interest at 9 1/2%.  The Company transferred
title to the purchaser in April 1997.  In May 1997, the Company
sold the mortgage, without recourse, to a non-affiliate of the
Company for $110,000.

    The Company estimates that it will require additional
capital in order to successfully implement its future operational
plans.  As a result, the Company is seeking additional capital
through, among other means, an infusion of noncollateralized
loans and the sale of additional equity in the Company.  However,
there can be no assurance that the Company will be able to obtain
additional capital on terms acceptable to the Company.  


                    PART II OTHER INFORMATION

Item 2.  Changes in Securities and Use of Proceeds

         During the quarter ended June 30, 1997, 7,250 shares of
5% non-voting Series A Cumulative Convertible Preferred Stock were 
subscribed for through a private offering exempt by Section 4(2) of 
the Securities Act of 1933.  Each share of Preferred Stock is 
convertible into 2 shares of the Company's common stock.


Item 6. Exhibits and Reports on Form 8-K
     
       (a)  Exhibit 27 Financial Data Schedule (For SEC use only)
       (b)  No reports on Form 8-K were filed during the quarter
for which this report is filed.




                           SIGNATURES

     In accordance with the requirements of the Exchange Act, the
registrant cause this report to be signed on its behalf by the
undersigned, thereunto duly authorized.

                            AMERICAN ASSET MANAGEMENT CORPORATION
                                         (Registrant)


Date:  December 1, 1997    By:_s/Richard G. Gagliardi____________
                              Richard G. Gagliardi
                              Chairman, President and Chief
                              Executive Officer (Principal
                              Executive and Financial Officer)

                               -10- 
<PAGE>