My numbers are 4 year averages of the S&P 500.
Basically, if the long term average is an amazing 6 or 8%, if you have a few years with 15-20% with no corresponding increase in productivity (even a decrease in productivity is what has been measured), then it must come down.
Basically, people were irrational for a couple of years. The stock market was too valuable due to hard irrationality. Now it is correcting. Yes, there will be some people who gained and then got out and kept their crazy gains. There are others who are starting now and just losing. But the average is someone who made crazy gains and are now having their crazy gains head towards what you would expect based on productivity and growth and so on.
JM
Basically, if the long term average is an amazing 6 or 8%, if you have a few years with 15-20% with no corresponding increase in productivity (even a decrease in productivity is what has been measured), then it must come down.
Basically, people were irrational for a couple of years. The stock market was too valuable due to hard irrationality. Now it is correcting. Yes, there will be some people who gained and then got out and kept their crazy gains. There are others who are starting now and just losing. But the average is someone who made crazy gains and are now having their crazy gains head towards what you would expect based on productivity and growth and so on.
JM
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