tag:blogger.com,1999:blog-7073066728112402191.post808356993672953962..comments2024-02-09T02:42:41.112-06:00Comments on Observations: 100-Years of Inflation-Adjusted Stock Market HistoryUnknownnoreply@blogger.comBlogger14125tag:blogger.com,1999:blog-7073066728112402191.post-56893964581080041082014-01-12T12:04:56.552-06:002014-01-12T12:04:56.552-06:00Excellent Analysis! You might also mention the Su...Excellent Analysis! You might also mention the Survival Bias of the DJI30. I am sure you have that in mind, but never really say it. If you net out the effects of Survival Bias (re-indexing without the pain) the Real market return, net of dividends, is probably less than 0%. Better off to just buy Treasuries and hold for 100 years.BrianMcMhttps://www.blogger.com/profile/10398039552715113665noreply@blogger.comtag:blogger.com,1999:blog-7073066728112402191.post-33131089941633270442013-01-05T20:23:40.833-06:002013-01-05T20:23:40.833-06:00Thanks for reading!Thanks for reading!Alhttps://www.blogger.com/profile/03349009181054767705noreply@blogger.comtag:blogger.com,1999:blog-7073066728112402191.post-80794860928697395362013-01-05T17:17:01.283-06:002013-01-05T17:17:01.283-06:00Great blog thanks for all the informationGreat blog thanks for all the informationMr chad geraldhttps://www.blogger.com/profile/12753346198171435292noreply@blogger.comtag:blogger.com,1999:blog-7073066728112402191.post-82775789631553779492012-06-10T07:10:34.195-05:002012-06-10T07:10:34.195-05:00I'm a little confused by this since on my comp...I'm a little confused by this since on my computer the images are quite legible -- even by these old eyes.<br /><br />Are you having difficulty even after you have clicked on the graphs to expand them? I'm not sure how to use less compression; can you say more?Alhttps://www.blogger.com/profile/03349009181054767705noreply@blogger.comtag:blogger.com,1999:blog-7073066728112402191.post-36431548766003994302012-06-10T05:16:26.112-05:002012-06-10T05:16:26.112-05:00Hi - Good info on this site, but please can you ma...Hi - Good info on this site, but please can you make the full size graph images bigger and use less compression so they are easier to read?Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-7073066728112402191.post-81726384334300614672012-05-16T19:23:35.863-05:002012-05-16T19:23:35.863-05:00It is finally great to hear reason from
these post...It is finally great to hear reason from<br />these posts. You are absolutely right on<br />the mark. The middle class is what made this country strong.Is that what big business <br />wants? I don't mind paying more for things<br />but for god's sake pay me enough to keep<br />up and have some left over to retire on.<br />I would rather me keep my SSN and invest it<br />the way I want to. Call me stupid but why<br />would I want to give my money away and live<br />in poverty?Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-7073066728112402191.post-23771889325560190902011-12-22T19:03:56.157-06:002011-12-22T19:03:56.157-06:00Your chart does not include the dividend payouts, ...Your chart does not include the dividend payouts, only the price index. Historically, dividends have provided about half of the return from stocks.Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-7073066728112402191.post-31442658419448109702011-10-25T19:13:02.167-05:002011-10-25T19:13:02.167-05:00For more on how expenses can impact published/hypo...For more on how expenses can impact published/hypothetical returns see, <a href="http://observationsandnotes.blogspot.com/2011/10/expenses-impact-on-investment-returns.html" rel="nofollow">Real World Expenses Reduce Published Market Returns.</a>Alhttps://www.blogger.com/profile/03349009181054767705noreply@blogger.comtag:blogger.com,1999:blog-7073066728112402191.post-55410043060897520262011-09-01T13:41:43.832-05:002011-09-01T13:41:43.832-05:00As I mention periodically, my stock market returns...As I mention periodically, my stock market returns are indeed hypothetical -- theoretical. Broadly reported returns are almost always hypothetical; they ignore all kinds of real world realities including taxes and other expenses (partly because to do otherwise one would have to decide <i>whose</i> taxes, expenses, etc. to include). For what it's worth, the returns for bonds and housing are equally hypothetical. Personally, I think such numbers are still useful. However, in all cases, you need to realize that your personal returns are likely to be different from the theoretical returns. <br /><br />I do mention this periodically, but not in every single post. I've been thinking about writing a post to consolidate all of the caveats and qualifications in one place, and to discuss some of the implications. Your comment is a welcome reminder that such a post could be worthwhile. Thanks.Alhttps://www.blogger.com/profile/03349009181054767705noreply@blogger.comtag:blogger.com,1999:blog-7073066728112402191.post-5430045810963046612011-09-01T09:47:12.253-05:002011-09-01T09:47:12.253-05:00Correct me if I’m wrong but I don’t think it was p...Correct me if I’m wrong but I don’t think it was possible to buy the DOW index back then. <br />Today we can purchase the ETF or some other instrument; I’ve yet to find a way to buy the index in 1900. <br /><br />Of course an investor could have purchased the 12 individual DOW components, but this complicates matters. <br /><br />All of the components (aside from GE) have gone bankrupt, were kicked out of the DJIA or they merged with other companies. <br />If it was impossible to own the index, as components changed- an investor would have to rebalance their portfolios frequently. <br />In other words; when stock market advocates praise the returns of the market with reinvested dividends, if one were able to hypothetically invest in 1900, and they tout today’s returns it is a bit of a lie. <br /><br />It would be very hard for a retail investor to sell and buy the DOW as it changed. Unless you were a trader and sold some stocks as they appreciated, to purchase new components as they were added it wouldn’t work. <br />I was unable to find a way to purchase the DOW back then, perhaps it did exist??? <br />Otherwise, it’s a hypothetical and impossible scenario to use a buy and hold strategy that went on for a 100 year span. <br /><br />As far as real world investments that have real world returns, I can only think of two. <br /><br />Saving a 1 dollar gold coin from 1900 (purchased for face value) would be worth 90 bucks today. <br /><br />Don’t sell passbook savings short. We are used to today’s anemic savings rates, but it wasn’t unusual to get 5% and higher in the past. <br />With compound interest and much higher interest rates, a dollar invested in 1900 would have returned better than a gold coin.csainvestorhttp://csainvestor.blogspot.com/noreply@blogger.comtag:blogger.com,1999:blog-7073066728112402191.post-24453379346789928942011-08-31T19:19:05.772-05:002011-08-31T19:19:05.772-05:00Thanks. Glad you're enjoying it.
The gap b...Thanks. Glad you're enjoying it. <br /><br />The gap between the highest income group and the lowest income group is indeed at record or near-record levels.<br /><br />I should point out, though, that these are actually not bad returns (don't forget, I've excluded dividends); I don't know of any asset class that performed better. It's just that inflation has historically been a major portion of what investors think of as their returns from stocks, housing and other long-term investments. As a result, when you remove the impact of inflation it's a bit of a shock.Alhttps://www.blogger.com/profile/03349009181054767705noreply@blogger.comtag:blogger.com,1999:blog-7073066728112402191.post-56825469076550754422011-08-31T16:19:24.815-05:002011-08-31T16:19:24.815-05:00You have done great work here.
I've been try...You have done great work here. <br /><br />I've been trying to yell at the world that the hidden inflation tax has decimated the middle class and the poor. <br /><br />You used CPI here, but if you priced this in gas or food, returns would be even worse. <br /><br />Real Inflation and stagnant wages has killed the middle class.csainvestorhttp://csainvestor.blogspot.com/noreply@blogger.comtag:blogger.com,1999:blog-7073066728112402191.post-65143310704282582722011-05-02T18:35:53.646-05:002011-05-02T18:35:53.646-05:00Thanks Anon. You're more than welcome.Thanks Anon. You're more than welcome.Alhttps://www.blogger.com/profile/03349009181054767705noreply@blogger.comtag:blogger.com,1999:blog-7073066728112402191.post-40969318983139896462011-05-02T18:18:41.519-05:002011-05-02T18:18:41.519-05:00Very interesting topic and well prepared. Thanks!Very interesting topic and well prepared. Thanks!Anonymousnoreply@blogger.com