Here is a link to a tutorial that was published at the Gummy Stuff web site re JWR1945's SWR work.
http://www.gummy-stuff.org/JWR.htm
Here is a table that JWR1945 prepared that shows the correlation between the valuation level (as assessed through use of PE/10, the valuation tool used by Shiller) that applied at the beginning of each 30-year returns sequence and the Historical DataBase Rates for 50 percent and 80 percent S&P portfolios associated with that 30-year returns sequence. (The HDBR is the highest take-out number that would have worked for that returns sequence.)
HDBR50 and HDBR80 Ordered by PE10 *
*
Lowest Valuations *
Code: *
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Year* PE10* HDBR50* HDBR80 *
1921* * 5.1* *9.6* *11.6 *
1922* * 6.2* *8.4* *10.3 *
1924* * 8.0* *7.9* * 9.5 *
1923* * 8.1* *7.6* * 9.0 *
1933* * 8.7* *5.8* * 8.4 *
1980* * 8.8* *9.2* *10.3 *
1975* * 8.9* *7.0* * 8.3 *
1978* * 9.2* *7.9* * 9.1 *
1979* * 9.2* *8.4* * 9.5 *
1932* * 9.3* *6.0* * 8.1 *
1925* * 9.6* *7.3* * 8.4 *
1942* *10.1* *6.1* * 9.1 *
1943* *10.1* *6.3* * 9.2 *
1949* *10.2* *7.8* *11.1 *
1948* *10.4* *7.7* *10.9 *
1950* *10.7* *7.3* *10.2 *
1944* *11.0* *6.1* * 8.6 *
1976* *11.1* *6.5* * 7.2 *
1926* *11.3* *6.9* * 7.7 *
1935* *11.4* *5.3* * 7.4 *
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*
Middle Valuations *
Code: *
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Year* PE10* HDBR50* HDBR80 *
1947* *11.4* *6.8* *9.4 *
1977* *11.4* *6.8* *7.4 *
1951* *11.8* *7.1* *9.4 *
1945* *11.9* *5.9* *8.2 *
1954* *12.0* *6.9* *9.0 *
1952* *12.5* *6.9* *9.0 *
1934* *13.0* *4.8* *6.3 *
1953* *13.0* *6.7* *8.6 *
1927* *13.1* *6.6* *7.3 *
1938* *13.5* *4.9* *6.6 *
1974* *13.5* *5.6* *5.9 *
1958* *13.7* *5.8* *6.8 *
1941* *13.9* *5.0* *7.0 *
1939* *15.5* *4.6* *6.0 *
1946* *15.6* *5.2* *6.7 *
1955* *15.9* *5.8* *6.9 *
1940* *16.3* *4.6* *6.1 *
1971* *16.4* *4.9* *5.0 *
1931* *16.7* *5.1* *5.6 *
1957* *16.7* *5.3* *6.0 *
*
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[/b]Highest Valuations[/b] *
Code: *
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Year* PE10* HDBR50* HDBR80 *
1936* *17.0* *4.4* *5.5 *
1970* *17.0* *4.8* *4.9 *
1972* *17.2* *4.8* *4.8 *
1959* *17.9* *5.0* *5.4 *
1956* *18.2* *5.2* *5.9 *
1960* *18.3* *5.0* *5.3 *
1961* *18.4* *5.0* *5.3 *
1973* *18.7* *4.7* *4.5 *
1928* *18.8* *5.7* *5.8 *
1963* *19.2* *4.9* *5.1 *
1967* *20.4* *4.5* *4.5 *
1962* *21.1* *4.7* *4.8 *
1969* *21.1* *4.3* *4.2 *
1968* *21.6* *4.3* *4.2 *
1937* *21.6* *3.9* *4.6 *
1964* *21.6* *4.6* *4.6 *
1930* *22.3* *4.8* *4.8 *
1965* *23.2* *4.3* *4.2 *
1966* *24.0* *4.2* *4.0 *
1929* *27.0* *4.6* *4.3 *
The tables show a correlation between the starting-point PE10 level and the HDBR for the 30-year returns sequence that follows. The PE10 for recent years is higher than it has been in any earlier time-period. That means that claims that a 4 percent withdrawal is safe for retirements beginning today are NOT analytically valid. An adjustment for today's valuation levels is needed, and an appropriate adjustment brings today's SWR for an 80 percent S&P portfolio down to 2.4 percent.