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Peter Bernstein on long term returns FT Feb 26
02-26-2009, 05:58 AM
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#1
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Peter Bernstein on long term returns FT Feb 26
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02-26-2009, 07:02 AM
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#2
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
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That was an awful lot of words to translate to "I don't know"...
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"Hey, for every ten dollars, that's another hour that I have to be in the work place. That's an hour of my life. And my life is a very finite thing. I have only 'x' number of hours left before I'm dead. So how do I want to use these hours of my life? Do I want to use them just spending it on more crap and more stuff, or do I want to start getting a handle on it and using my life more intelligently?" -- Joe Dominguez (1938 - 1997)
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02-26-2009, 08:05 AM
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#3
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
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Quote:
Originally Posted by ziggy29
That was an awful lot of words to translate to "I don't know"...
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That is not exactly what he is saying. He is saying, "It can't be known, and this is why..."
Ha
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"As a general rule, the more dangerous or inappropriate a conversation, the more interesting it is."-Scott Adams
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02-26-2009, 08:39 AM
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#4
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
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Ha, either interpretation lands you in exactly the same place...
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Numbers is hard
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02-26-2009, 09:42 AM
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#5
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Administrator
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Of course, he could also be saying ... just because equity prices are low doesn't mean they are any more likely to rise substantially over the next decade or two...
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02-26-2009, 09:44 AM
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#6
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
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Quote:
Originally Posted by MichaelB
Of course, he could also be saying ... just because equity prices are low doesn't mean they are any more likely to rise substantially over the next decade or two...
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...or any less.
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Numbers is hard
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02-26-2009, 09:45 AM
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#7
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Thinks s/he gets paid by the post
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I guess I'm stuck flipping this damn quarter for a while longer, huh?
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There is no pleasure in having nothing to do; the fun is having lots to do and not doing it. - Andrew Jackson
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02-26-2009, 09:46 AM
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#8
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
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Quote:
Originally Posted by MichaelB
Of course, he could also be saying ... just because equity prices are low doesn't mean they are any more likely to rise substantially over the next decade or two...
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Or that stocks will either rise or fall in the next few years, unless they flatline.
__________________
"Hey, for every ten dollars, that's another hour that I have to be in the work place. That's an hour of my life. And my life is a very finite thing. I have only 'x' number of hours left before I'm dead. So how do I want to use these hours of my life? Do I want to use them just spending it on more crap and more stuff, or do I want to start getting a handle on it and using my life more intelligently?" -- Joe Dominguez (1938 - 1997)
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02-26-2009, 09:47 AM
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#9
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: May 2005
Location: Lawn chair in Texas
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Quote:
Originally Posted by Leonidas
I guess I'm stuck flipping this damn quarter for a while longer, huh?
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I wouldn't toss it too high; someone might grab it in midair...
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Have Funds, Will Retire
...not doing anything of true substance...
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02-26-2009, 10:08 AM
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#10
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
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I think this article is mostly bear market blues.
Ha
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"As a general rule, the more dangerous or inappropriate a conversation, the more interesting it is."-Scott Adams
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02-26-2009, 02:38 PM
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#11
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Administrator
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Actually, compared to his interviews and the stuff he's written over the past 4 years, this was absolutely bullish. Well, almost. But still, his tone was very downbeat 'til now - almost scary. Here he seems to be saying - hey, stocks can go up or down, and don't take anything for granted.
This man clearly is a consultant.
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02-26-2009, 03:01 PM
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#12
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
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Location: Kansas City
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Sooo - he doesn't want to admit - numbers are meaningless cause:
He's back! Paul Volcker that is. First old Reagan now Obama.
Thus - it's crystal clear we should be buying stocks hand over fist for the next 25 years.
Right? .
First the long bond/aka inflation and now stocks.
heh heh heh - Between our own Ziggy and Volcher we got this thing in the bag. . Of course non partisan wise you could just Pssst Wellesley and not take sides.
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02-27-2009, 07:13 PM
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#13
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
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Quote:
The long-run results we can discern in the data of stock market history are not a random set of numbers: each event was the result of a preceding event rather than an independent observation.
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Quote:
On a total return basis, the Ibbotson data show that the S&P 500 has underperformed long-term Treasury bonds for the last five-year, 10-year, and 25-year periods, and by substantial amounts.
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Well we know that the starting period for long Treasury yields (3.7%) is well below where it was 5 years ago (5.4%) and 10 years ago (5.6%) and 25 years ago (11.2%). And we also know that the S&P 500 P/E-10 (12.8x) is well below where it was 5 years ago (27.7x) and 10 years ago (40.4x) but not 25 years ago (10.5x).
Given this data set I'd say the chances are very good that stocks outperform long treasuries over the next 25 years.
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02-28-2009, 08:28 AM
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#14
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
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Said another way, in each of those periods (5, 10, 25-yr) the yield on 30-yr Treasuries was almost 200bp higher than the earnings yield on stocks. Now the earnings yield on stocks is more than 400bp higher than treasuries.
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02-28-2009, 08:33 AM
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#15
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Thinks s/he gets paid by the post
Join Date: Jan 2004
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Quote:
Originally Posted by ziggy29
That was an awful lot of words to translate to "I don't know"...
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That's why we are computer geeks, and they are "quoted experts." Lesson: Even when you don't know, spew some hot air.
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02-28-2009, 01:50 PM
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#16
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
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It's time to PANIC!!!!
you first.
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I have outlived most of the people I don't like and I am working on the rest.
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03-01-2009, 07:42 AM
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#17
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Thinks s/he gets paid by the post
Join Date: Jul 2006
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Long Run
"In the long run we're all dead".
John Maynard Keynes
You can take that to the Bank!.....uh...bad choice of words.
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“I guess I should warn you, if I turn out to be particularly clear, you've probably misunderstood what I've said” Alan Greenspan
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03-01-2009, 07:57 AM
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#18
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Recycles dryer sheets
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According to Haver Analytics (I believe, don't have the research in front of me), between 1982 to 2000 if you had bought 30 year zeros, and simply sold them and reinvested back into zeros at the end of the year, you would have beat the S&P by a factor of 4 (4X). Pretty good results during the biggest stock bull market, and of course it's due to the unusually high interest rates in 1982. Last year they outperformed again, +30%ish compared to -45%ish.
Hoisington investment has a newsletter on their site which has much more about the performance of long treasuries versus stocks, during this 30 year period at least.
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