Exactly 8 years separates us from the 2007 peak in the Dollar adjusted S&P500. What is that? If you divide the S&P500 by the USDollar, you can see what the US market looks like to Non-US Investors.
Looking back from the June 15, 2007 Peak to June 15, 2015 -
The S&P is up less than 40% (excluding dividends)
Meanwhile, you had to lose 55% of your portfolio value first.
So many of us feel like we have tripled our money from the lows, but we are just playing a game in our mind. In reality we have made less than 6% return per year, after taxes you are up 3% and after 3% inflation you are at breakeven. So much volatility for not much return.
This chart doesn't give trading advice - just perspective. On one hand it shows that we haven't had a reading of -16% in 982 trading days or 1392 calendar days. That is a long time to not take a breather. We have had almost 9 readings of +16% (some are just shy of +16%) and zero readings of -16%. Clearly, the Fed doesn't want downside volatility in order to spur investment, wealth creation, leverage and to expand balance sheets of the world so that debt service costs don't become a problem. I just wonder when balance will return to the markets.
I published this chart before, so you can find the older version here too.
As as for my inflation of 3% per year, that is the long term average over the past 50 years here in the US.
Tim
Looking back from the June 15, 2007 Peak to June 15, 2015 -
The S&P is up less than 40% (excluding dividends)
Meanwhile, you had to lose 55% of your portfolio value first.
So many of us feel like we have tripled our money from the lows, but we are just playing a game in our mind. In reality we have made less than 6% return per year, after taxes you are up 3% and after 3% inflation you are at breakeven. So much volatility for not much return.
This chart doesn't give trading advice - just perspective. On one hand it shows that we haven't had a reading of -16% in 982 trading days or 1392 calendar days. That is a long time to not take a breather. We have had almost 9 readings of +16% (some are just shy of +16%) and zero readings of -16%. Clearly, the Fed doesn't want downside volatility in order to spur investment, wealth creation, leverage and to expand balance sheets of the world so that debt service costs don't become a problem. I just wonder when balance will return to the markets.
I published this chart before, so you can find the older version here too.
As as for my inflation of 3% per year, that is the long term average over the past 50 years here in the US.
Tim
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