The NY Times ran an eye catching graphic earlier this week in honor of the S&P500 finally reaching the level set at the close of the previous decade (Dec 31, 1999, otherwise known as the beginning of the end of the bubble). It re-indexes the market by currency, and provides a good picture of the impact of dollar devaluation as well as rising commodity and housing prices.
Conclusion? The market gains of the past few years have not been what they appeared.
Hat Tip: The Big Picture
Worst President ever.
An insightful cut of the analytic knife. The news from Wall Street has had a hollow ring to it, and this does illustrate why.
–chuck
But isn’t the relevant information the trendline, as opposed to the point? That is, the endpoint of the “in dollars” graph shows that the index has just now reached what it was about 7 years ago, but the trend shows pretty steep increase with no inflection point to a decrease.
(I’m not being argumentative here, and I am not a finance guy. Just curious about how to further interpret this.)
It means that the world economy has gone back to medieval times, so we should dump paper and start buying ingots, barrels, bushels, and acres.