Fabulous set of charts looking at inflation adjusted S&P composite during major secular bear markets, via The Chart Store:
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Here is the current crash and snapback:
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Prior bear markets (WWI, great Depression, 1970s) after the jump
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Please use the comments to demonstrate your own ignorance, unfamiliarity with empirical data, ability to repeat discredited memes, and lack of respect for scientific knowledge. Also, be sure to create straw men and argue against things I have neither said nor even implied. Any irrelevancies you can mention will also be appreciated. Lastly, kindly forgo all civility in your discourse . . . you are, after all, anonymous.
We’re about to get another leg down in this bear market.
Oil and commodity prices are rising, yet, the supply of oil is NOT constrained. Speculators are driving the price (this this http://xrl.in/7gft with Prof Greenberger formerly with the CFTC) and regulators are bending over to kiss the kingaling of big money, as they’ve been known to do for the last 35 years.
It’s not going to end well. Yes BO, that includes you too.
BR, I wish we could find a chart showing the S&P 500 with reinvested dividends during the 1966-1982 bear market. Assuming a 4% average dividend, it’s possible the drop into the 1982 low could have been on the order of 40-50% adjusted for inflation rather than the 66% cited.
Most pensioners have no clue of the devastating effects of the 1966-1982 bear on real, after tax returns.
This is super-stupid.
Literally, embarassingly stupid.
1) It looks like its adjusted for inflation (some theoretical amount) but not for dividends (real $). 2) Why adjust for inflation? What other comparisons are “inflation adjusted”? (Ans: none!) TIPS pay like 1%… if you’re lucky.
What does gold return in “inflation adjusted” terms from 1980-2000? Howabout oil?
What dividends do they pay?
S&P paid some big, big dividends in the 1970s… like 5, 6%.
The effect of CPI is just as significant as the effect of nominal S&P 500 index value on the shape of the graph over long time periods.
Any error compounded over decades is huge. For example 1% error compounded over 70 years leads to 100% error.
The methods for calculating CPI have changed significantly over the measurement period.
The composition of the S&P 500 index has changed continuously over the time period… so I don’t really see what useful information can be gained from the graph. How many companies from 50 years ago are still in the index, let alone in existence.
Yes, as others have said, dividends are very significant, especially in the past… I bet they have accounted for more than 50% of total return.
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It is better to be vaguely right than precisely wrong.
Taking a step back from the awful tragedy that Japan is dealing with, the economic/market reaction will be characterized by a few common words over the weeks to come such as volatility, uncertainty, and disruption. Most importantly for Japan and analyzing what comes next is stabilization in their nuclear plants. After that occurs, we can better assess. The other market moving news obviously on a different human level is what came out of the EU summit. Both stock and bond markets are rallying sharply particularly in Greece but also in Portugal, Ireland, Spain and Italy. Greece now has 7.5 years...
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