81–90 of 282 posts
A paper on a similar topic but with much better execution: The Rate of Return on Everything, 1870–2015, https://economics.harvard.edu/files/economics/files/ms28533.... . Among other things, it spans multiple countries, and includes housing in the comparison.
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You've got it backwards. In 1923, your 8 million 1923-dollars was worth what $138 million 2023-dollars is today. You started with $138 million 2023-dollars, but denominated in 1923-dollars that's $8 million. If you just hold on to it your 1923-dollars have become 2023-dollars, but there's still exactly $8 million of them. You've lost nearly 95% of the value.
however, given that your 1923 dollars were likely silver dollars which currently trade for $32 (for junk grade) and up ... I made that 8m * 32 = 256m :) - and better if you were sensible and stored un-circulated dollars
> your 1923 dollars were likely silver dollars
It's unlikely that you had 200 metric tons of silver coins stashed away.
Until the beginning of the 20th century, stocks were viewed as a purely speculative investment. The idea that buy and hold will provide great returns is a modern one and is supported by the growth of the stock market in the 20th century. There is also the issue of survivorship bias. The SP500 and Dow Jones indices regularly discard the losers and add new companies, so we don't know the true results of holding compani…
The Titanic was built a bit over 100 years ago for 1.5m pounds -- today that'd buy you a nice London two-bedroom apartment. I wonder if in 100 years from now, people will casually be talking about their nice (but modest) London two-bedroom apartment they bought for 100m pounds.
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> Put another way, since 1928 dividends plus inflation accounted for 99.7% of the nominal wealth produced, as of 2008, by investing in stocks. I feel like I must be missing something. Why are dividends treated differently from price increases? As I'm saving for retirement, "stock goes up" and "stock pays dividends" are basically the same thing in my mind. I assume a dividend is effectively a price increase that gets…
> I feel like I must be missing something. Why are dividends treated differently from price increases? you're thinking about it the right way, and they aren't treated differently the way you're thinking. They way they are treated differently is, if you just look at historical stock prices you will miss the dividends being siphoned off, so you have to track the dividends and put those amounts back into your charts, an…
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> getting rid of dividends makes no sense and is borderline intellectually dishonest just to make the point How so? Once you retire, you don't let dividends reinvest. Makes perfect sense.
Dividends aren't enough to cover living expenses. If you plan to withdraw 4% per year, so you preserve your wealth indefinitely, you're more than 2 percentage points short when the dividend yield is 1.71% [1] If you want to live solely from dividends, you'll need more than double the capital. If you want to die with zero [2], it's impossible. I'd much rather invest in a dividend-accumulating index fund and sell as I…
The Titanic was built a bit over 100 years ago for 1.5m pounds -- today that'd buy you a nice London two-bedroom apartment. I wonder if in 100 years from now, people will casually be talking about their nice (but modest) London two-bedroom apartment they bought for 100m pounds.
You can see the number phenomenon today. People still talk about "winning £1M on the Lottery" like it'd set them up for a life of luxury. To reasonably replace even a median UK full-time salary for life you're going to need around ~£700K in assets. That leaves £300K for a modest home somewhere outside of London and the South East. One false move with your £1M winnings and you'll end up back in the office. The £ is worth half of what it was in 1994 when the Lottery started.
The Titanic was built a bit over 100 years ago for 1.5m pounds -- today that'd buy you a nice London two-bedroom apartment. I wonder if in 100 years from now, people will casually be talking about their nice (but modest) London two-bedroom apartment they bought for 100m pounds.
[1] https://www.history.com/news/titanic-facts-construction-pass...
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>Tech advancements are slowing down Are they? I think they've been slow for maybe the last 20 years, but it seems like the advances in things like AI and Genomics are rapidly accelerating and may lead to growth like we haven't seen in several decades...
> I think they've been slow for maybe the last 20 years Really? 20 years is the difference between a generation being raised pre/post: * smart phones * streaming services (endless free content) * massive computing storage / processing upgrades * mass adoption of eCommerce * video calling * ubiquitous social networking * EVs * mRNA vaccines * Mars exploration * LHC * 3D printing It amazes me to look back at 2003 and s…
A paper on a similar topic but with much better execution: The Rate of Return on Everything, 1870–2015, https://economics.harvard.edu/files/economics/files/ms28533.... . Among other things, it spans multiple countries, and includes housing in the comparison.