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re: what's supporting the market?
Posted on 4/12/11 at 10:15 pm to JPLSU1981
Posted on 4/12/11 at 10:15 pm to JPLSU1981
No way, no one would ever argue that. That's just straight up nonsense.
In case 10 years is too short of a long run for you, here's 40: [LINK]
In case 10 years is too short of a long run for you, here's 40: [LINK]
This post was edited on 4/12/11 at 10:18 pm
1
Posted on 4/12/11 at 10:35 pm to kfizzle85
1st link is legit... and certainly depressing.
major issue with the second link you posted as its output does not give an accurate depiction of the period considering the S&P should be on top.
major issue with the second link you posted as its output does not give an accurate depiction of the period considering the S&P should be on top.
This post was edited on 4/12/11 at 10:39 pm
Posted on 4/12/11 at 10:44 pm to JPLSU1981
Legitimately do not understand what you mean by that.
Posted on 4/12/11 at 10:48 pm to kfizzle85
quote:
Legitimately do not understand what you mean by that.
S&P500 total return (including dividends reinvested) was over 4000% for the period shown. He showed price only, which is not an apples-to-apples comparison to the TBonds, which includes the coupon payments in return shown. The originator of the chart apologized for it in the first comment below the chart.
Posted on 4/12/11 at 10:57 pm to kfizzle85
quote:
Legitimately do not understand what you mean by that.
S&P500 total return (including dividends reinvested) was over 4000% for the period shown. He showed price only, which is not an apples-to-apples comparison to the TBonds, which includes the coupon payments in return shown. The originator of the chart apologized for it in the first comment below the chart.
legitimate S&P vs 10yrTBonds should be either:
1264% vs 0% (price only)
OR
4500% vs 1700% (total return)
This post was edited on 4/12/11 at 10:58 pm
Posted on 4/12/11 at 11:01 pm to JPLSU1981
I did not notice that, that's my fault. I improperly assumed it was all total return. If you caught that without reading the comments I commend you.
Posted on 4/12/11 at 11:23 pm to kfizzle85
Anywho, my question for Ooohpoopoo was not necessarily mocking the notion that Treasuries may or may not outperform the market over the next 30 years (although I feel confident they won't), my question for him was more accurately mocking his leap from:
Conversation A: Will the stock market be higher in 30 years than it is today?
To...
Conversation B: Will the stock market outperform treasuries over the next 30 years?
Conversation A: Will the stock market be higher in 30 years than it is today?
To...
Conversation B: Will the stock market outperform treasuries over the next 30 years?
This post was edited on 4/12/11 at 11:25 pm
Posted on 4/12/11 at 11:35 pm to Nyala
Liquidity is being pumped into the system would be my guess, but fundamental analysis will rarely amount to anything significant in the stock game. i.e., YHOO had 700x PE in 1999. Everyone knew this wasn't sustainable. Some went short. YHOO continued to a PE of 2000x before the tech bubble burst. The fundamentalists were correct, but were not profitable.
Posted on 4/13/11 at 12:27 am to LSURussian
Posted on 4/13/11 at 12:31 am to JPLSU1981
quote:
WTF does the risk-free rate have to do with anything in the context of this discussion?
What doesn't it? When you said the market was a good long term investment - I assumed by "good" you meant it would beat the risk free rate, no?
You are arguing that the equity premium of the U.S. stock market in the 20th century is not an aberration - that its the normal - I'm saying I don't believe you.
quote:
are you now arguing that treasuries are a better long-term investment than the stock market?
You appear to be arguing that you know for certain the stock market it better. I'm asking you to show me how you know this - and all you can do is point to the U.S. stock market of the 20th century. Wasn't the U.S. stock market of the 20th century one of the best ever? It would seem like you're selecting your data to come to your preconceived conclusion.
This post was edited on 4/13/11 at 12:37 am
Posted on 4/13/11 at 12:42 am to JPLSU1981
quote:
Conversation A: Will the stock market be higher in 30 years than it is today?
To...
Conversation B: Will the stock market outperform treasuries over the next 30 years?
What did you think I meant? If you had invested in 30 treasuries at certain points in the early 80's you would have beaten total market returns over that period.
This post was edited on 4/13/11 at 12:57 am
Posted on 4/13/11 at 7:36 am to Trender
What "fundamentalist" was "correct" with Yahoo at a P/E of 2000x?
Posted on 4/14/11 at 1:49 am to kfizzle85
quote:
What "fundamentalist" was "correct" with Yahoo at a P/E of 2000x?
The market doesn't just take into account present earnings but future earnings as well. A company that has negative earnings can be highly valued if the investors believe the future returns will be high.
Not saying yahoo wasn't overvalued obviously - but merely the fact that P/E is high doesn't mean a stock is overvalued.
This post was edited on 4/14/11 at 1:50 am
Posted on 4/14/11 at 9:54 am to OohPooPahDoo
Thanks, that had nothing to do with my question.
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