Adjusting for inflation, the Dow is basically where it was in 1966.
This doesn't include dividends.
From February 9, 1966 to yesterday’s close, the Dow gained 562.7%. The CPI from February 1966 to January 2009 (we'll get February's report on March 18) rose 559.8%.
That works out to a real gain of 43 basis points stretched out over 43 years.
| Windfall Tax on Retirement Income Adding a tax to your retirement is simply another way of saying to the American people, you're so darn stupid that we're going to keep doing this until we drain every cent from you. That's what the Speaker of the House is saying. Read below................ Nancy Pelosi wants a Windfall Tax on Retirement Income. In other words tax what you have made by investing toward your retirement. This woman is a nut case! You aren't going to believe this. Madam speaker Nancy Pelosi wants to put a Windfall Ta x on all stock market profits (including Retirement fund, 401K and Mutual Funds! Alas , it is true - all to help the 12 Million Illegal Immigrants and other unemployed Minorities! This woman is frightening. She quotes...' We need to work toward the goal of equalizing income, (didn't Marx say something like this), in our country and at the same time limiting the amount the rich can invest.' ( I am not rich, are you) When asked how these new tax dollars would be spent, she replied: 'We need to raise the standard of living of our poor, unemployed and minorities. For example, we have an estimated 12 million illegal immigrants in our country who need our help along with millions of unemployed minorities. Stock market windfall profits taxes could go a long way to guarantee these people the standard of living they would like to have as 'Americans'.' [Read that qu ote again and again and let it sink in. 'Lower your retirement, give it to others who have not worked as you have for it'. ] This lady is out of her mind and she is the speaker of the house! |
“The latest Financial Times economic weather map for Europe shows a further substantial deterioration since it was last published in October, when the devastating impact on the global economy of the collapse of Lehman Brothers, the investment bank, was only just becoming apparent.
“European industrial production collapsed in November, data this month have shown, and business confidence surveys suggest the bottom of the recession - set to be among the worst since the second world war - has not yet been reached.”
Source: Ralph Atkins and Ben Hall, Financial Times, January 20, 2009.
According to Jeff Rubin of Birinyi Associates, bank stocks have fallen further and faster than at any time in history, including the Great Depression.
Rubin said on Tuesday, the day of their big sell off, bank stocks were down 78.51 percent from their February, 2007 high. At a parallel point in the 1930s (two years from their high), bank stocks were down 78.09 percent.
It's not a huge difference but ultimately, bank stocks lost a total 89 percent in the Depression era. It took them another nine months from the two-year mark to get there.
"I think the real point here is everyone is looking for a quick rebound in the financials. If you're looking for any guidance, the only guidance we have is the Great Depression. We went 20 years without a rebound. It was sideways until the 1950s, at least for the banks," he said.
Financials are now at an 18-year low in terms of weighting in the S&P 500. They are at 9.99 percent. Tech was in first place, with 16.1 percent and health care was a close second at 15.83.
Earnings news blew up what could have been a second up day for stocks, and it was Microsoft's surpise release of a worse than expected quarter that really sent stocks spinning.
Financials though continue to lead the decline, down about 6 percnet today, while tech is down 3.2 percent. Some of the worst performers are Huntington Bancshares, Fifth Third, Aflac, Citigroup, SLM and Bank of America..
Rubin shared this chart with us.
 |
Source: Birinyi Associates, INC. Source: Tanking Banks Make History Tanking Banks Make History - Market Insider with Patti Domm Posted By: Patti Domm CNBC.com, Jan.22 2:14 PM ET http://www.cnbc.com/id/28796525 |
Interesting take over the weekend in Marketwatch on stock market bottoms relative to historic trendlines.In past bear markets, whenever equities as a group fall into the range of 40-42% below trend, at bottom was not far off.
HFN editor Peter Brimelow, along with ESR Research’s Edwin S. Rubenstein observe:
“We have looked at stocks relative to this long-term trend line. When we last looked, we found stocks were down 38% below trend, around the levels seen at historic bear market bottoms in 1981 (40% below trend), 1974 (41% below trend) and 1932 (42% below trend).”
The concept was developed via Jeremy Siegel’s Stocks for the Long Run. (Note: Siegel does not necessarily agree with their conclusions).
Brimelow and Rubenstein show the historic relationship between the two via this chart:
The >
Source:
Stocks’ bottom in sight. Again.
They can’t go much lower before reaching unsustainable depths
Peter Brimelow & Edwin S. Rubenstein
Marketwatch, 9:28 p.m. EST Jan. 18, 2009
http://tinyurl.com/stockbottomtrendreversion
The equity market's decline since Election Day has been the worst ever lame duck period (election to inauguration) for stocks since at least 1900. With today's declines, the S&P 500 has lost 19.8% of its value since the November 4th election. Below we highlight the best and worst performing groups over that same time period. Unfortunately, only 2 out of 65 groups (representing only 5 of the stocks in the S&P 500) are positive since the election.
On the downside, 24 out of 65 groups (38%) are underperforming the overall index since the election. As shown, the woes in the Financials have been extreme, as the five worst performing groups are all from that sector. Will those hoping for a reprieve from the credit crisis under a new adminstration have to wait another four or eight years? Let's hope not.
Visit msnbc.com for Breaking News, World News, and News about the Economy
January 18, 2009
Hat tip distressed volatility
The WSJ has a nice interactive map showing the details of the Israeli/Hamas battle:
>
click for interactive graphic:
via WSJ
~~~
Hat tip Calculated Risk
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