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re: The DowJones Industrial Average AND the S&P500 Index both closed at record highs today
Posted on 1/20/24 at 12:38 am to Decisions
Posted on 1/20/24 at 12:38 am to Decisions
quote:
I get where you’re coming from, but what is incorrect about his statement? The dollars are worth less. It’s not the only problem, of course. We have seen a stock market run fueled almost entirely by the Magnificent Seven while the rest of the S&P 493 languish. Margins and revenue for most are down. Debt is up and popping some like grapes.
Dollars are worth less every year, and the broad market is also up considerably since 2021 - RSP is the equal weight S&P 500 and it’s up 28% over the same 3 years.
I realized it’s politically convenient to downplay the stock market under Biden, and I’m no fan of his whatsoever, but at some point it gets a little embarrassing. I’m not accusing you of doing so, but many in here just cannot fathom that stocks can do well under any president.
quote:
If they weren’t borrowing money for investments I would have doubts about this. These index appreciations are at best keeping you even with actual inflation, not beating it
Why is that hard to believe? People have a lot more money in their investment accounts, their homes are worth a lot more, and their pay has essentially kept up with inflation. If they have a lower real net worth today than they did 3 years ago they’re probably doing something wrong.
Also, “actual inflation” as defined by who? I hate the cost of a bag of chips just like anyone else, but no one seems to also recognize you can buy a 55” 4K Smart TV for $280. I haven’t seen an increase in my internet or phone bill in a few years it seems. Lots of things cost more than they did a few years ago. Some haven’t really budged. Some cost less.
5
Posted on 1/20/24 at 2:50 am to slackster
quote:
you can buy a 55” 4K Smart TV for $280
TVs are unique in that they continually cost less over time. And that’s including new technology. Most goods are not like that. A dozen eggs costs far more now than it did in 2019.
Already outdated due to massive inflation. But my point - TVs are the worst example here
Posted on 1/20/24 at 5:56 am to slackster
You are an absolute fool if you believe CPI is only up 17% in the last 3 years. Your example of TVs being "less" is a perfect example of how the numbers are manipulated. Their costs are subsidized by big tech so they can feed you more ways to consume their content. Find me a 4k 55" smart TV for $280 that isn't loaded with bloat/spyware. That's not even to mention that I don't need a damn TV to live.
Posted on 1/20/24 at 8:12 am to slackster
quote:
Dollars are worth less every year, and the broad market is also up considerably since 2021 - RSP is the equal weight S&P 500 and it’s up 28% over the same 3 years.
Thats cool. Meanwhile my day-to-day spend items are up damn near double.
Its gotten so bad this past year I actually price check. I havent done that in 10 years.
You become dumbfounded when you get 6 things and your grocery bill is $100...
This post was edited on 1/20/24 at 8:13 am
Posted on 1/20/24 at 8:54 am to JayDeerTay84
quote:
Thats cool. Meanwhile my day-to-day spend items are up damn near double.
Holy hyperbole. We’re straight up just making shite up.
Beef is up 35%. Chicken is up around 30%. Bread is similar. Rice is up 24%. Milk is up 16%. Gas is up 28% as I mentioned.
All less than or equal to the S&P 500 over the same time frame.
But because eggs are up around 70%, the stock market performance must be Ho hum?
Posted on 1/20/24 at 8:58 am to Upperdecker
quote:
Already outdated due to massive inflation. But my point - TVs are the worst example here
My point is that CPI is made up of a lot of things. The fact that your grocery bill is up 30% over the last 3 years doesn’t mean that everything is up 30%, but that’s really difficult for some to understand around here.
And like I continue to say, people just completely ignore their net worth growth and their actual income growth over the same time frame.
This post was edited on 1/20/24 at 8:59 am
Posted on 1/20/24 at 9:03 am to slackster
quote:
the broad market is also up considerably since 2021 - RSP is the equal weight S&P 500 and it’s up 28% over the same 3 years.
It certainly is. What do you think fueled that surge? Productivity and efficiency increases? Expanding, new markets? Or currency debasement?
quote:
I realized it’s politically convenient to downplay the stock market under Biden, and I’m no fan of his whatsoever, but at some point it gets a little embarrassing.
I understand. There are certainly some who do this. My personal problems with the market (and perhaps some others on this board) are politically neutral. Both sides have been fiscally irresponsible.
quote:
Why is that hard to believe? People have a lot more money in their investment accounts, their homes are worth a lot more, and their pay has essentially kept up with inflation.
The first two are nominal values (which we all know are irrelevant) and the third is not true across the board.
The service jobs with big increases were the lowest paying and HAD to make these increases or risk all of their workers dropping out of the labor force. The rest knew their workers could afford to trim the fat in one place or another and thus were less aggressive.
quote:
Also, “actual inflation” as defined by who?
Who you gonna believe, me or your lying eyes? I don’t care what agency du jour tries to tell me inflation is. I’ve seen it with my own eyes. We had closer to 20% inflation at the peak. We’re well past 35% net, and as I said that’s just in goods. I personally witnessed a farm sell for ~$3500/acre shortly before Covid and the one right next to it sold for ~$5500 last year. Comparable land. Residential in desirable areas has been even more egregious.
Posted on 1/20/24 at 9:16 am to Decisions
quote:
t certainly is. What do you think fueled that surge? Productivity and efficiency increases? Expanding, new markets? Or currency debasement?
Various combinations of all of those, like it usually is in history.
quote:
The first two are nominal values (which we all know are irrelevant) and the third is not true across the board
They’re not irrelevant when they’re up a lot, and all of your wage data is in a 12m or shorter stretch. The point I’ve been making is over the last 3 years cumulatively. Wages have continued to climb in 2023 while inflation has cooled, so they’ve climbed back out of the hole created mostly in 2022. Your other chart starts in the beginning of the pandemic and is pretty much useless as a result.
Posted on 1/20/24 at 9:22 am to LSURussian
I don't get the point of this whole argument. Inflation has been bad the past few years. It's been bad in the past. It'll be bad in the future again at some point.
The most reliable way to outpace it over the long term is to invest. Everyone should be rooting for the market to thrive, especially those pissed off by inflation.
So again, what exactly is the point of a "yah but inflation" argument in this thread?
The most reliable way to outpace it over the long term is to invest. Everyone should be rooting for the market to thrive, especially those pissed off by inflation.
So again, what exactly is the point of a "yah but inflation" argument in this thread?
Posted on 1/20/24 at 9:23 am to LSUSUPERSTAR
quote:
And out of the top 50%, how many are realizing these gains before the next downturn? While it is great that my retirement accounts are up, I'm paying out the nose for groceries and other items.
Right. 90% of what I pump in goes to 401k/IRA/HSA so while the numbers in those account looks nice they're still a couple decades away. My month to month is still impacted.
Posted on 1/20/24 at 9:28 am to Decisions
quote:
Who you gonna believe, me or your lying eyes? I don’t care what agency du jour tries to tell me inflation is. I’ve seen it with my own eyes. We had closer to 20% inflation at the peak. We’re well past 35% net, and as I said that’s just in goods. I personally witnessed a farm sell for ~$3500/acre shortly before Covid and the one right next to it sold for ~$5500 last year. Comparable land. Residential in desirable areas has been even more egregious.
As far as land/home prices go, I really don’t get the complains. 66% of Americans own homes that have gone up a ton in value, so that’s a problem? People don’t buy homes very often, so this “yeah but homes are unaffordable” is a problem for a small subset of people that don’t also already own a home.
And as I’ve pointed out, we’re not well past 35% net. You can gripe about the weighting of CPI and whatnot, but dig into the individual categories.
good ol gold is up a whopping 7%. “Inflation hedge” though, right? Posted on 1/20/24 at 9:53 am to slackster
quote:
Holy hyperbole. We’re straight up just making shite up.
Beef is up 35%. Chicken is up around 30%. Bread is similar. Rice is up 24%. Milk is up 16%. Gas is up 28% as I mentioned.
Really? What I said was identical the the chart UpperDecker posted on my grocery bill. Havent seen you refute that one yet...
Is his chart wrong?
Posted on 1/20/24 at 10:13 am to slackster
Conjoined those graphs give an idea of wage inflation from the start of COVID through 2022. Naturally the data hasn’t all been compiled and made public for 2023, but it gives an idea as to what wages have done in the time period we were discussing for the market growth and overall inflation.
I firmly believe the paper gold market is still being manipulated and thus useless for average people. Physical gold with its premiums and discounts is closer to the real deal, but I still wouldn’t bother.
Like I said, if you want to ride with and beat inflation buy hard, income-producing assets (preferably with some leverage).
quote:
good ol gold is up a whopping 7%. “Inflation hedge” though, right?
I firmly believe the paper gold market is still being manipulated and thus useless for average people. Physical gold with its premiums and discounts is closer to the real deal, but I still wouldn’t bother. Like I said, if you want to ride with and beat inflation buy hard, income-producing assets (preferably with some leverage).
Posted on 1/20/24 at 10:16 am to Thundercles
quote:
Right. 90% of what I pump in goes to 401k/IRA/HSA so while the numbers in those account looks nice they're still a couple decades away. My month to month is still impacted.
I think this is the thing.
Look, I'm glad the market is up... and I'm glad the market is up in real dollars after accounting for inflation.
But none of those gains are impacting me today. They are paper gains.
Meanwhile the actual expenses I have today are higher, even adjusting for wage growth (to the poster who argued inflation by saying that wages are higher... most people are not having wage growth keep up with inflation).
So yes, my net worth is higher today. When it comes to paying bills and buying things today, the fact my net worth is higher is a completely irrelevant thing.
So... the people gaining from inflaion are investors... but most of those investors don't get to today enjoy the actual benefits of those gains.
Meanwhile, the 5% or whatever that lives on those gains... and the retired boomers... are the ones getting to benefit today.
Posted on 1/20/24 at 10:19 am to JayDeerTay84
quote:
Really? What I said was identical the the chart UpperDecker posted on my grocery bill. Havent seen you refute that one yet... Is his chart wrong?
His chart is over 20 years man.
Posted on 1/20/24 at 10:26 am to Decisions
quote:
Conjoined those graphs give an idea of wage inflation from the start of COVID through 2022. Naturally the data hasn’t all been compiled and made public for 2023, but it gives an idea as to what wages have done in the time period we were discussing for the market growth and overall inflation.
I posted the numbers in the thread for the last 3 years - real, median wages are down 1.7% since 1/2021. That’s not nominal, it’s already adjusted for inflation.
I get it - it hurts paying $7 for a bag of fricking Doritos (frick you Pepsi), but my paycheck is up considerably over the last 3 years too. As is the case for a lot of people.
Posted on 1/20/24 at 11:14 am to slackster
quote:Egg prices have dropped by over 50% in the last six months of 2023.
But because eggs are up around 70%
The big spike in egg prices in early 2023 was because so many producing chickens had to be destroyed to control the avian flu outbreak.
Egg prices are almost back down to where they were prior to the avian flu outbreak.
Today a dozen eggs costs around $2.00-$3.00/dozen, down from about $5.00/dozen last January.
The whole "egg prices are out control" mantra is way over blown today.
Posted on 1/20/24 at 11:21 am to LSURussian
quote:
The big spike in egg prices in early 2023 was because so many producing chickens had to be destroyed to control the avian flu outbreak.
Slight sidebar here, did anyone else think it suspicious that as the US-China trade war got going in earnest that they suddenly started having rolling swine flu outbreaks decimating their herds and we had avian flu and multiple meat/food processing plants go up in flames?
Just an interesting coincidence, I thought.
Posted on 1/20/24 at 11:33 am to JayDeerTay84
quote:Could you please tell us what six grocery items costs a $100?
you get 6 things and your grocery bill is $100...
I bought some groceries this week and my total was about $70 and that was for 9 or 10 plastic bags of groceries...probably around 25-30 items.
I'm not accusing you of lying but I'm genuinely curious what six grocery items you bought cost you $100. Thanks.
PS-If you say one of the items was a 1.75L bottle of Jack Daniel's Gentleman Jack whiskey I'll understand.
Posted on 1/20/24 at 12:47 pm to Decisions
quote:
Just an interesting coincidence, I thought.
Speaking of coincidences, 3 years is a very Biden centric timeframe, so it’s very popular around here, but going back 4 years really tells the tale of inflation, stocks, wages, hard assets, etc.
Since 1/1/2020:
QQQ up 103%
VTI up 55%
IVV up 59%
RSP up 45%
DIA up 43% (DJIA ETF)
Nominal wages up 21%
Real wages up 2%
CPI up 19%
Gold up 34%
Regular Gasoline up 19%
Beef up 34%
Chicken up 33%
Bacon up 23%
Eggs up 71%
Rice up 38%
Bread up 50%
Milk up 21%
Median sales price of homes up 31%
Moral of the story is that unless you can find a way to stockpile and store eggs for 4 years, stocks are one of the most efficient and easiest ways to outpace overall inflation.
It’s also worth noting eggs are highly volatile historically. Last year was insane but they then fell like 70% and they fluctuated +/- 25% in 2018-2019 too.
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