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Stock market charts you never saw (2021)

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Re: Stock market charts you never saw (2021)

#271

Post by int_19h »

ilikehurdles wrote: post #20
recuter wrote: post #10

If I was alive in 1923 and stashed away $8 million in ̶c̶a̶s̶h̶ (Edit: 100y bonds) would only be worth about $140 million today. Had I put it into some fancy ETF (Recall Vanguard dates back only to 1975, but whatever) I'd be a billionaire. That's it, that is the entire difference of less than an order of magnitude. Don't reckon the nickels and the dimes matter much to centenarians. Most people don't even have $8000 t…

If you had $8million in 1923 cash stashed away, you’d have $8million in 2023 cash today. Ie you’d have lost about 94% of your buying power.

If we're being pedantic, it depends on what kind of cash. A silver 1923 dollar coin goes for $20-30 today.

Re: Stock market charts you never saw (2021)

#272

Post by karatinversion »

edgyquant wrote: post #163
karatinversion wrote: post #53

Earlier quoted context omitted.

The parent specifically refers to holding it as cash (“under the mattress”), though. And of course, if you do put it in the bank 1923, there’s no deposit insurance for the first ten years, any possible bank might just go under in the first ten years…

How many of them did though?

The numbers I find are that some 11,000 out of 25,000 U.S. banks failed between 1929 and 1933 - the key words to search for are “bank failure” and “Great Depression”

Re: Stock market charts you never saw (2021)

#273

Post by georgeecollins »

dragonwriter wrote: post #177
georgeecollins wrote: post #173

One of the charts you don't see is the performance of the stock market from say 1900-1950 for countries like Russia, Japan, France or Germany. We have this point of view that the US is a good place to invest, but to an investor in 1900 that might not have been such an obvious choice. Looking back 50 years from now it may seem like it was obvious the US was going to collapse from some political issue and clear that yo…

> One of the charts you don't see is the performance of the stock market from say 1900-1950 for countries like Russia The St. Petersberg Stock Exchange closed in 1914, reopened briefly for a short period in 1917, and then did not reopen thereafter. But a comparison of it to the US between 1864 and 1914 is available: https://www.investmentoffice.com/Observations/Markets_in_His...

That's my point. No one knew the St Petersberg stock exchange would close in 1914. The US stock exchange could close in 2044 and no one would be expecting it. 50 year predictions are unreliable.

Re: Stock market charts you never saw (2021)

#274

Post by daddylongstroke »

Amazing: a giant (and informative) thread on markets, investing, and value with many asking the same question - "but what else are you going to invest in?" - and not a single mention of building soil, and in turn health, or even "goats"...and I heavily expected goats to be at least mentioned.

Re: Stock market charts you never saw (2021)

#275

Post by bagacrap »

saberience wrote: post #239
bionsystem wrote: post #235

Earlier quoted context omitted.

There are hedge funds beating markets over and over, some have been macro driven, some are equity driven, some are quant driven... Now of course it's a pareto law, only a handful out of 100 will get all the excess return and the others will stagnate or underperform indices (or even fail completely). But the same goes for building any company, most of them fail and we watch winners in awe.

Most hedge funds in fact DON'T beat the market though. In almost every case you would have been better to buy index funds and hold versus put your money in a hedge fund.

Correct. The true function of a hedge fund is not to beat the market over the long haul, which is generally impossible. The goal is to avoid losing huge amounts of wealth, for people who have way more money than they need. Hence the name --- you put money in there as a hedge against short term losses in equities.

Re: Stock market charts you never saw (2021)

#276

Post by bagacrap »

trompetenaccoun wrote: post #230
bagacrap wrote: post #193

Earlier quoted context omitted.

Is there a strategy that reliably beats buy and hold? Obviously not or everyone would do it. And no investment professional worth their salt would advise to buy individual companies to hold for the long term (almost all will go out of business or underperform eventually) so I'm not sure what purpose the survivorship bias comment serves.

Everyone doesn't know how to successfully invest or there wouldn't be so many middle class and poor people. Buying and holding (a broad index tracker) seems like the best strategy for someone who doesn't know about the businesses or can't be bothered to follow the market. It's the most passive strategy. Imo the mistake most make is they mentally compare it to themselves reading a bit online and then picking stocks ba…

I agree everyone doesn't know how to invest well. Some people even advise stock picking! :)

But the problem of some people not being rich is not simply because they can't invest well. First, obviously, not everyone can be rich. Second, most people suffer from the problem that they don't save enough, rather than that they don't invest well enough.

Yes, some people do beat the market. Obviously a lot of people are playing the lotto every day, and some win. Do they do it reliably? No. Disabuse yourself of the notion that beating the market is ever anything other than luck.

Re: Stock market charts you never saw (2021)

#277

Post by zie »

sleton38234234 wrote: post #160
zie wrote: post #100

Earlier quoted context omitted.

The other option is they raise taxes, cut spending and they actually pay those debts off. All debt comes due eventually, you can choose to go bankrupt or you can choose to pay it. But if neither option happens in your lifetime, you don't need to care, if you are just trying to optimize for yourself.

>> you can choose to go bankrupt or you can choose to pay it. There's another option. One that's far more politically favorable: You simply take out more and more debt, until finally the whole world sells US treasuries. at that point the fed prints unlimited amount of money to buy up all that debt. And when the US pays interest on that debt, it just pays it to the federal reserve which then sends it back to the US. T…

That is our current trajectory, but anyone with a modicum of common sense knows there is an end.

The question, which was what my comment was about, is how we eventually get to the end. We either buck up and pay it, or we crash and burn.

I'm betting we buck up and pay it, and just have a very bad decade or three, while taxes go up and spending goes down.

Re: Stock market charts you never saw (2021)

#278

Post by zie »

shkkmo wrote: post #105
zie wrote: post #100

Earlier quoted context omitted.

The other option is they raise taxes, cut spending and they actually pay those debts off. All debt comes due eventually, you can choose to go bankrupt or you can choose to pay it. But if neither option happens in your lifetime, you don't need to care, if you are just trying to optimize for yourself.

Federal debt "comes due" all the time. The option you haven't listed (which is the one we're engaged in) is: "You can choose to borrow more money to pay your creditors". The interest on federal debt recently makes up (very roughly) 1/3 of our total deficit. This is why when the US doesn't raise the "debt ceiling" we risk defaulting on our debts.

That was my point.

At some point, we can't keep borrowing to satisfy our debt(s). The question then becomes, what happens? This current inflation is actually a not bad thing for US debt, as we are inflating away some of it. It totally sucks for those of us that want to buy food and shelter though.

Either we endure some hardship(s) and have a miserable decade or three or we crash and burn.

I'm betting we endure the hardships. The other option(s) are much worse.

Re: Stock market charts you never saw (2021)

#279

Post by shkkmo »

zie wrote: post #278
shkkmo wrote: post #105

Earlier quoted context omitted.

Federal debt "comes due" all the time. The option you haven't listed (which is the one we're engaged in) is: "You can choose to borrow more money to pay your creditors". The interest on federal debt recently makes up (very roughly) 1/3 of our total deficit. This is why when the US doesn't raise the "debt ceiling" we risk defaulting on our debts.

That was my point. At some point, we can't keep borrowing to satisfy our debt(s). The question then becomes, what happens? This current inflation is actually a not bad thing for US debt, as we are inflating away some of it. It totally sucks for those of us that want to buy food and shelter though. Either we endure some hardship(s) and have a miserable decade or three or we crash and burn. I'm betting we endure the ha…

> At some point, we can't keep borrowing to satisfy our debt(s)

Why not? It's just a question of the rate of growth of the debt, the interest rates the USG pays on its debt, the rate of inflation and the rate of growth of the GDP/tax base.

There is absolutely a level of deficit spending that can be supported indefinitely. The question is whether we are above or below that level, not whether that level exists.

Re: Stock market charts you never saw (2021)

#280

Post by anyfoo »

Aachen wrote: post #258
anyfoo wrote: post #195

Earlier quoted context omitted.

But then what? Put it into a money market account where it gets eaten up by inflation?

More like a bank account falling under the deposit insurance. Don't gamble with money you can't do without, is what I was trying to convey. If you mean for a pension (assuming there is no state-supplied minimum pension that you could live from if necessary), get a pension plan where it stipulates how much you'll get per month rather than something where you depend directly on the market's daily whims. Very wide-sprea…

> Don't gamble with money you can't do without, is what I was trying to convey.

That's fair, but my point was that retirements saving are money one "cannot miss" (as in the original comment) or "can't do without".

And yet I think it has to be invested, for example in the options you listed, because keeping it in a bank account will only expose it to inflation, and hurt your retirement.

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