Guy who says skookum AND asymptotic wrote:
Cherry Pick these
July 1987-The peak before the black Monday 22% crash, and companion bear market to Ocotober 2018. SP 500 with Dividend Reinvestment 9.4 percent. Not double digit perhaps, but pretty damn skookum.
Adjust the completion to December 2018, after our recent 20% correction, and you still get 8.8 percent.
Adjust the initiation to December 1987, and through last October, you get 10.6%.
Going down through the history of the last 60 years.
Reagan Reelection in 1984-11.17%
Reagan was elected- 11.4%.
Nixon's election- 9.9%
This, my friend, is what I call a skookum asymptotic function. Carter was bad for stocks, Reagan was good-yet they've almost got the same returns 40 years later. I've cherry picked nothing--just election results and assassinations and political scandals--Vietnam is in there, September 11 is in there, Carter's malaise is in there, the collapse of US manufacturing is in there---yet it's all pretty much 10% no matter what starting point you choose for the past 60 years-except for periods in the last 20.
Don't know how old you are, but the 1970s was not an era of postwar boom. That pretty much fizzled out after the Tet offensive. I would argue market returns are depressed from the 10% mean over the past 20 years because the "war on terrorism" has been a drag on our economy. Think how much more profitable business travelers could be if they did not waste all that time taking off their shoes and belts at airport check in lines.
This is a moment for optimism. The US is the world's leading producer of petroleum right now--when was the last time that happened? On an inflation adjusted basis, gasoline is as cheap as it's ever been in my lifetime--and we're not kowtowing to OPEC to do it. This is an enormous tailwind to our economy, and stabilizing force in the war against terror.
Ghost of Igloi wrote:
Guy who says Skookum a lot wrote:
Ghost of Igloi wrote:
seattle prattle wrote:
Igy, it's hard to take your claims seriously.
You make a claim that "the next year will take you back eight years."
Then to prove it you post a chart of the SNP 500 that purports to show how long various downturns took to recover to the previous highs. Well, okay.....
But no where does it show a one year period in which 8 years of previous gains were wiped out.
Don't get me wrong. If that were true and based on historical precedent, i would like to be aware of it. But it is simply not borne out by the data. In fact, by all appearances, the downturns have very closely mirrored the previous years uptrends, such that one year of losses would wipe out only approximately one year of gains. Yes, there are some brief stretches of a few months in which the loss excelerates, but if you look at most any 12 month period, it is equal in magnitude to one 12 month period of previous gains.
I find your claims to be not fully supported. I know, I know, ... I'll find out. I'm just saying, if you are going to attempt to assert your wild claims with data, one would think that the data would at least do that- support your claim. All it does is sensationalize normal market trends with the apparent purpose of inciting panic.
No, you are blind to facts. And you repeat myths that hurt investors. Similar posters are the problem and not me.
Simple address to your post: How do you explain the 3/2000-3/2010 S&P 500 return with reinvested dividends of -4.252%?
It's no different than picking another set of dates--perhaps March 2009 to October 2018 which would show a 9 year annualized return of close to 15%. If you pick a low at the start, and a high at the end, the returns are skookum. If you pick a high at the start, and a low at the end, the returns are disappointing.
OK, then how do you explain the 3/2000-9/2018 S&P 500 annualized return of 3.851%. That is a high point to a high point. Your belief in double digit annualized equity reurns is a myth. Of course it will work if yo can time travel back to 1880 and project those returns forward. Problem is you will not live that long and the economic potential of this country is nowhere near the post-WW II era.
I you just believe Toto it will make it so.
I am 68 years old. You forgot all the debt that got us here. Besides at any of your starting points there were more makers than takers, all of that has been reversed (SocialSecurity/Medicare). All you have to do is look at historical GDP figures to see the flaw in your assumptions. In regards to oil, we are expprting oil at $60 a barrel only to in the future to import it at $120. Fracking is rapidly depleting any reserves. Nice to be optimistic but to ignore the headwinds facing this country is part of the problem and will never be a solution. In conclusion, I am not against equity investment, I believe fundamentals matter and there is little other than extreme monetary and fiscal policy to support current valuations.Fed policy is the reason this will be the third greater than -50% bear market in a twenty year period. Buckle up.