#OT# Hard data on "investment" returns
F. George McDuffee
For some hard data on the actual return on investment see
http://www.bloomberg.com/apps/news?pid=20601087&sid=azRby9JhxPH0&pos=2
<snip>
Investors who put $10,000 in stocks on Dec. 31, 1999, have $9,090
now, while the same amount in 10-year Treasury notes would have
grown to about $18,000 following a 6.1 percent annualized return,
according to data compiled by Bloomberg. A $10,000 investment in
the Reuters/Jefferies CRB Index of 19 raw materials increased 3.3
percent a year to $13,803. Gold futures rose 14 percent a year,
turning $10,000 into $37,852.
<snip>
===========
Unka George
(George McDuffee)
The past is a foreign country;
they do things differently there.
L. P. Hartley (1895-1972), British author.
The Go-Between, Prologue (1953).
Winston
> FYI --
>
> For some hard data on the actual return on investment see
> http://www.bloomberg.com/apps/news?pid=20601087&sid=azRby9JhxPH0&pos=2
> <snip>
> Investors who put $10,000 in stocks on Dec. 31, 1999, have $9,090
> now, while the same amount in 10-year Treasury notes would have
> grown to about $18,000 following a 6.1 percent annualized return,
> according to data compiled by Bloomberg. A $10,000 investment in
> the Reuters/Jefferies CRB Index of 19 raw materials increased 3.3
> percent a year to $13,803. Gold futures rose 14 percent a year,
> turning $10,000 into $37,852.
*Now* he tells me.
--Winston
--
Congratulations Robert Piccinini and Steven A. Burd, WalMart Publicists of the Year!
Gunner Asch
<gmcd...@mcduffee-associates.us> wrote:
>FYI --
>
>For some hard data on the actual return on investment see
>http://www.bloomberg.com/apps/news?pid=20601087&sid=azRby9JhxPH0&pos=2
><snip>
>Investors who put $10,000 in stocks on Dec. 31, 1999, have $9,090
>now, while the same amount in 10-year Treasury notes would have
>grown to about $18,000 following a 6.1 percent annualized return,
>according to data compiled by Bloomberg. A $10,000 investment in
>the Reuters/Jefferies CRB Index of 19 raw materials increased 3.3
>percent a year to $13,803. Gold futures rose 14 percent a year,
>turning $10,000 into $37,852.
><snip>
And yet I read countless Leftwingers all pissy and nasty about folks who
bought gold and have sat on it.
>===========
>
>
>Unka George
>
>(George McDuffee)
>
>The past is a foreign country;
>they do things differently there.
>L. P. Hartley (1895-1972), British author.
>The Go-Between, Prologue (1953).
"I am for doing good to the poor, but I differ in opinion of the
means. I think the best way of doing good to the poor, is not
making them easy in poverty, but leading or driving them out of
it. In my youth I travelled much, and I observed in different
countries, that the more public provisions were made for the
poor the less they provided for themselves, and of course became
poorer. And, on the contrary, the less was done for them, the
more they did for themselves, and became richer." -- Benjamin
Franklin, /The Encouragement of Idleness/, 1766
Ignoramus16758
> On Sat, 02 Jan 2010 11:28:28 -0600, F. George McDuffee
><gmcd...@mcduffee-associates.us> wrote:
>
>>FYI --
>>
>>For some hard data on the actual return on investment see
>>http://www.bloomberg.com/apps/news?pid=20601087&sid=azRby9JhxPH0&pos=2
>><snip>
>>Investors who put $10,000 in stocks on Dec. 31, 1999, have $9,090
>>now, while the same amount in 10-year Treasury notes would have
>>grown to about $18,000 following a 6.1 percent annualized return,
>>according to data compiled by Bloomberg. A $10,000 investment in
>>the Reuters/Jefferies CRB Index of 19 raw materials increased 3.3
>>percent a year to $13,803. Gold futures rose 14 percent a year,
>>turning $10,000 into $37,852.
>><snip>
>
>
> And yet I read countless Leftwingers all pissy and nasty about folks
> who bought gold and have sat on it.
So, do you recommend buying gold now? Or what are you saying, exactly?
How many of the current gold holders bought it at a low? How many of
them will sell at the high? How many will buy at the high and sell at
a low? We do not know that. We know one thing only: they will not any
dividends from their gold holdings, no matter when they bought or sold.
There is a particular category of people who predict the future by
extrapolating the past. Those are the ones who would say "stocks
always outperform bonds in the long run" or "gold has been doing
great, I want to get on the bandwagon" or "we are in for a repeat of
Great Depression because stocks are falling".
Those are the same kinds of people who bought homes because their
prices were rising.
This mentality of extrapolating they past without thinking always
leads to ruinous financial results, due to buying into overhyped
assets.
I consider gold to be overhyped at present, and, as a result, I will
not invest in it. I have no idea how high it will go, but I am just
not going to participate.
My personal investment results from my investments that I had (and
kept throughout) from year 2000, are roughly 90.4% total cumulative
return. This does not include any additional investments that I made
with savings from years after January 2000. Only the investments that
I had in the beginning of the decade, which I still happen to be
carrying.
To a large extent, the reason for this modest, but respectable gain is
not doing anything particularly brilliant, but simply avoiding fads
of both bullish and bearish nature.
While not as spectacular as the return on gold, I feel that 90% over a
decade is a good result, considering the more typical outcomes, and it
does establish a certain level of credibility as far as my investment
mentality is concerned.
i
dca...@krl.org
16758.invalid> wrote:
>
> While not as spectacular as the return on gold, I feel that 90% over a
> decade is a good result, considering the more typical outcomes, and it
> does establish a certain level of credibility as far as my investment
> mentality is concerned.
>
Certainly a 90% return over this last decade is a good result.
Dan
Winston
Where can I download your investment guide, Iggy?
Wes
>> And yet I read countless Leftwingers all pissy and nasty about folks
>> who bought gold and have sat on it.
>
>So, do you recommend buying gold now? Or what are you saying, exactly?
I don't know if Jon Stewart was full of chit or not but he was poking fun at gold sellers
on Fox that had a 30% commision.
How did you buy your gold Iggy? What was the markup?
Wes
--
"Additionally as a security officer, I carry a gun to protect
government officials but my life isn't worth protecting at home
in their eyes." Dick Anthony Heller
John R. Carroll
> Ignoramus16758 <ignoram...@NOSPAM.16758.invalid> wrote:
>
>>> And yet I read countless Leftwingers all pissy and nasty about folks
>>> who bought gold and have sat on it.
>>
>> So, do you recommend buying gold now? Or what are you saying,
>> exactly?
>
> I don't know if Jon Stewart was full of chit or not but he was poking
> fun at gold sellers on Fox that had a 30% commision.
You might want to reconsider Wes.
He was poking fun at idiots buying and selling gold that were paying a 30
percent premium to brokers.
Gold is a market for children and POG people.
It has absolutely no basis, reality or use in the real world.
Completely Speculative is the best description.
--
John R. Carroll
Ignoramus16758
> Ignoramus16758 <ignoram...@NOSPAM.16758.invalid> wrote:
>
>>> And yet I read countless Leftwingers all pissy and nasty about folks
>>> who bought gold and have sat on it.
>>
>>So, do you recommend buying gold now? Or what are you saying, exactly?
>
> I don't know if Jon Stewart was full of chit or not but he was
> poking fun at gold sellers on Fox that had a 30% commision.
30% commission? Wow
> How did you buy your gold Iggy? What was the markup?
I never bought any gold. In retrospect, maybe I should have thought of
something about gold, in early 2000s, but I did not.
I did own silver for a few years, in form of six or seven 100
oz. silver bars. Silver is an important industrial metal, with many
applications, though less so now with the decline of film photography.
i
Ed Huntress
"John R. Carroll" <nu...@bidness.dev.nul> wrote in message
news:kuCdnXefqrfvbqLW...@giganews.com...
We may be missing something here, John. If things get *really* rough, gold
would make good fishing sinkers and, probably, pretty good bullets.
Lead may be too valuable then to use for the purpose. <g>
--
Ed Huntress
Ignoramus16758
> dca...@krl.org wrote:
>> On Jan 2, 9:38 pm, Ignoramus16758 <ignoramus16...@NOSPAM.
>> 16758.invalid> wrote:
>>
>>> While not as spectacular as the return on gold, I feel that 90% over a
>>> decade is a good result, considering the more typical outcomes, and it
>>> does establish a certain level of credibility as far as my investment
>>> mentality is concerned.
>>>
>>
>> Certainly a 90% return over this last decade is a good result.
>
>
I do not have an investment guide and I do not even think that I am a
smart investor. In 1999, I bought a bunch of Berkshire Hathaway stock
and never sold it to date. I knew that it would not be "next
Microsoft", but at the price, I thought that it would give me some
solid return.
By the way, it is also relatively attractive in relation to its
current price, as well. In other words, it is not very "fully
valued".
I had some opportunities to take advantage of runups in its price, but
never did, just to underscore that I am not a very successful investor.
i
Ignoramus16758
> Wes wrote:
>> Ignoramus16758 <ignoram...@NOSPAM.16758.invalid> wrote:
>>
>>>> And yet I read countless Leftwingers all pissy and nasty about folks
>>>> who bought gold and have sat on it.
>>>
>>> So, do you recommend buying gold now? Or what are you saying,
>>> exactly?
>>
>> I don't know if Jon Stewart was full of chit or not but he was poking
>> fun at gold sellers on Fox that had a 30% commision.
>
> You might want to reconsider Wes.
> He was poking fun at idiots buying and selling gold that were paying a 30
> percent premium to brokers.
Just curious, who are those brokers and where do they operate? I might
have missed something.
> Gold is a market for children and POG people.
What is POG?
> It has absolutely no basis, reality or use in the real world.
> Completely Speculative is the best description.
And pays no dividend and accrues no earnings.
i
John R. Carroll
Actually Ed, when things get really rough - the guy with the bio, R***,
ends up with a 4 X bypass and an artery from somewhere in his chest directly
connected to his heart. He's also on insulin now rather than drugs and his
older brother is minding the store.
I've got a great John Doer story that I'll probably have to take to my
grave.
Interesting that I'm not getting paid for all of this, wouldn't you say?
--
John R. Carroll
Ed Huntress
"John R. Carroll" <nu...@bidness.dev.nul> wrote in message
Every advertising copywriter and beat reporter has a half-written novel in
his desk. d8-)
--
Ed Huntress
Gunner Asch
<ignoram...@NOSPAM.16758.invalid> wrote:
>On 2010-01-02, Gunner Asch <gun...@lightspeed.net> wrote:
>> On Sat, 02 Jan 2010 11:28:28 -0600, F. George McDuffee
>><gmcd...@mcduffee-associates.us> wrote:
>>
>>>FYI --
>>>
>>>For some hard data on the actual return on investment see
>>>http://www.bloomberg.com/apps/news?pid=20601087&sid=azRby9JhxPH0&pos=2
>>><snip>
>>>Investors who put $10,000 in stocks on Dec. 31, 1999, have $9,090
>>>now, while the same amount in 10-year Treasury notes would have
>>>grown to about $18,000 following a 6.1 percent annualized return,
>>>according to data compiled by Bloomberg. A $10,000 investment in
>>>the Reuters/Jefferies CRB Index of 19 raw materials increased 3.3
>>>percent a year to $13,803. Gold futures rose 14 percent a year,
>>>turning $10,000 into $37,852.
>>><snip>
>>
>>
>> And yet I read countless Leftwingers all pissy and nasty about folks
>> who bought gold and have sat on it.
>
>So, do you recommend buying gold now? Or what are you saying, exactly?
Not now...2 yrs ago would have been ok. 15 yrs ago would have been far
better.
Now I buy canned goods, first aid gear, replacement mantals, etc etc
etc.
its far far too late to be buying gold. The bottom falling out is not
that far off now.
>
>How many of the current gold holders bought it at a low? How many of
>them will sell at the high? How many will buy at the high and sell at
>a low? We do not know that. We know one thing only: they will not any
>dividends from their gold holdings, no matter when they bought or sold.
Of course not. However..there is profit or not.
>
>There is a particular category of people who predict the future by
>extrapolating the past. Those are the ones who would say "stocks
>always outperform bonds in the long run" or "gold has been doing
>great, I want to get on the bandwagon" or "we are in for a repeat of
>Great Depression because stocks are falling".
Yes.
>
>Those are the same kinds of people who bought homes because their
>prices were rising.
Really? Then you can provide cites to back up your case.
Ill be waiting .
>
>This mentality of extrapolating they past without thinking always
>leads to ruinous financial results, due to buying into overhyped
>assets.
You buy when its low..and you sell when its high. Period. Like a load
of cotton or wheat.
No one is buying and selling food stocks or raw materials?
When did that happen?
>
>I consider gold to be overhyped at present, and, as a result, I will
>not invest in it. I have no idea how high it will go, but I am just
>not going to participate.
Good for you laddy. Its probably too late to make a few bucks on it
anyways.
>
>My personal investment results from my investments that I had (and
>kept throughout) from year 2000, are roughly 90.4% total cumulative
>return. This does not include any additional investments that I made
>with savings from years after January 2000. Only the investments that
>I had in the beginning of the decade, which I still happen to be
>carrying.
Good for you!
>
>To a large extent, the reason for this modest, but respectable gain is
>not doing anything particularly brilliant, but simply avoiding fads
>of both bullish and bearish nature.
Excellent!
>
>While not as spectacular as the return on gold, I feel that 90% over a
>decade is a good result, considering the more typical outcomes, and it
>does establish a certain level of credibility as far as my investment
>mentality is concerned.
Sounds like you picked well!
Now how much wheat, corn, cotton and so forth have you purchased in that
past decade?
Hummmm????
Gunner
>
>i
Bill McKee
"Ed Huntress" <hunt...@optonline.net> wrote in message
news:4b3ff482$0$22507$607e...@cv.net...
You want to invest in gold, just buy the stock GLD. Priced at 1/10 of an
oz. Hell of a lot less commission than 30%.
Bill McKee
"Ignoramus16758" <ignoram...@NOSPAM.16758.invalid> wrote in message
news:EcidnapeH5fBaaLW...@giganews.com...
I probably still have maybe 10 oz of silver, but I used to make jewelery as
hobby and Silver was about $3 an OZ then.
Ed Huntress
"Bill McKee" <bmckee...@ix.netcom.com> wrote in message
news:M_SdnbTQoPYzYqLW...@earthlink.com...
No, thanks. I'm not a speculator. Nor do I bet against my country's health.
--
Ed Huntress
Gunner Asch
Neither do wheat, corn, oil, molassis or natural gas.
Yet folks get rich buying and selling them,
How does that work again?
Gunner
Ed Huntress
"Gunner Asch" <gun...@lightspeed.net> wrote in message
news:gl10k5dnmcuf786p8...@4ax.com...
People eat wheat, corn, and molasses. They burn oil and gas.
With gold, they hoard it and hope that, when they want to sell, they'll find
someone dumber than they are, to buy.
The entire speculation on gold is predicated on having people who will buy
fairly useless material at absurd prices, in the hope that there will be
more people around willing to buy useless material at even more absurd
prices when the time comes. If things don't get too ridiculous, such people
are always around. The question is whether a real, serious crisis will
suddenly shock large numbers of people into a realistic assessment of what
they're buying.
--
Ed Huntress
pyotr filipivich
about Sat, 02 Jan 2010 18:10:08 -0800 did write/type or cause to
appear in rec.crafts.metalworking the following:
>
>>> And yet I read countless Leftwingers all pissy and nasty about folks
>>> who bought gold and have sat on it.
>>
>>So, do you recommend buying gold now? Or what are you saying, exactly?
>
>Not now...2 yrs ago would have been ok. 15 yrs ago would have been far
>better.
I was playing with the price of gold and the cost of living.
Interesting how the _average_ annual price fluctuated, particularly
when considered in terms of current dollars. I.e. the Average price
per ounce in 1980 was $612.56. That would be about 1600 dollars in
"purchasing power". So Gold is not really at an "all time high" - not
compared to the inflation adjusted peak of $2022
Of course, as a friend put it "It is always a good time to buy.
It's not always a good time to sell..." (Anybody want to buy a
house?)
-
pyotr filipivich
We will drink no whiskey before its nine.
It's eight fifty eight. Close enough!
CalifBill
I do not own gold or GLD. Lots better paying stocks. But you may think
about betting on the US getting sicker. With this Congress and POTUS
spending money both copiously and stupidly we are in for some large scale
inflation in the future. The Fed can not continue printing money and giving
zero interest loans. Look at NLY and MFA as high paying stocks with some
underlying worth. Look at the oil companies, as we will still need energy.
Look at the sin stocks. Philip Morris, etc. MO P/E of 12 and a 6+%
dividend. Bonds at the present time have to be some of worst investments to
make. Especially any longer term ones. If you want bonds, get some state
General Obligations. California bonds are paying 5-6% tax free. But unless
you hold that bond to term, the principal will decrease when the interest
rates rise. Which they have to do shortly. Real estate is still in the
tank, little will turn it around. The foreclosures we are starting to see
and will see lots of this year, are not subprime loans. They are going to
be people with jobs who can pay the mortgage. But with loan payments
resetting much higher and the loan value much higher than the home value.
There is a new term for these defaults. Strategic Defaults. Why pay when
you will never get the money back.
John R. Carroll
> On 2010-01-03, John R. Carroll <nu...@bidness.dev.nul> wrote:
>> Wes wrote:
>>> Ignoramus16758 <ignoram...@NOSPAM.16758.invalid> wrote:
>>>
>>>>> And yet I read countless Leftwingers all pissy and nasty about
>>>>> folks who bought gold and have sat on it.
>>>>
>>>> So, do you recommend buying gold now? Or what are you saying,
>>>> exactly?
>>>
>>> I don't know if Jon Stewart was full of chit or not but he was
>>> poking fun at gold sellers on Fox that had a 30% commision.
>>
>> You might want to reconsider Wes.
>> He was poking fun at idiots buying and selling gold that were paying
>> a 30 percent premium to brokers.
>
> Just curious, who are those brokers and where do they operate? I might
> have missed something.
Asia mostly and they "operate" in their skivies from a bedside laptop
mostly.
You only have to look at price fluctuations, and perhaps you have, to see
that someting isn't right.
Manufacturers that actually use gold in their product lines pay a pittance
for their supply relative to the spot market.
>
>> Gold is a market for children and POG people.
>
> What is POG?
A small round thing similar to a coin that kids trade like baseball cards.
IIRC, there was actually a trading exchange of sorts set up by the Korean
manufacturers at one point. Funniest damned bit of lunacy on earth that was.
http://en.wikipedia.org/wiki/Pogs
Pogs became so popular during the 1990s that thousands of types of pogs were
manufactured, covering a wide array of toys; cartoons; movies; games;
sports; images of famous people on the front of the pogs; images of famous
world leaders such as Former U.K Prime Minister Tony Blair & Former U.S
President William "Bill" Clinton; PA messages such as First Aid safety,
Wiled life Prevention & anti-drug and Fund raising for various charities &
organizations such as The Red Cross & Cancer research and ALF (TV Series),
who returned after many years of obscurity in pog form. The popularity of
the game spawned POG prizes at major fast-food chains (see below), as well
as knockoffs, such as "Slammer Whammers," a similar game released under a
different brand name. Pogs can sometimes still be found on eBay and in game
and card stores. During the early 1990s a US national pog tournament was
held every February 7 in honor of the game's inventor's birthday.
>
>> It has absolutely no basis, reality or use in the real world.
>> Completely Speculative is the best description.
>
> And pays no dividend and accrues no earnings.
It's gambling, pure and simple.
The entire market is driven by rumors in the same way short sellers were
driving equity markets to support their naked shorts.
The only winners are the guys that make the market.
Gold is the worlds persistent Pet Rock.
--
John R. Carroll
John R. Carroll
Yeah I suppose, except Russ really did just go through this, and on my
birthday no less.
9 hours.
--
John R. Carroll
John R. Carroll
Remember the great Hunt brothers silver run up?
LMAO
Even they got burned.
--
John R. Carroll
dca...@krl.org
> I did own silver for a few years, in form of six or seven 100
> oz. silver bars. Silver is an important industrial metal, with many
> applications, though less so now with the decline of film photography.
>
> i
Actually gold is an important industrial metal, but wide spread use is
limited by the price. If gold was $100 / lb you would see it widely
used. One use would be for solar collectors. It is the best infrared
reflector and does not tarnish.
Dan
Wes
>> I don't know if Jon Stewart was full of chit or not but he was poking
>> fun at gold sellers on Fox that had a 30% commision.
>
>You might want to reconsider Wes.
>He was poking fun at idiots buying and selling gold that were paying a 30
>percent premium to brokers.
>Gold is a market for children and POG people.
>It has absolutely no basis, reality or use in the real world.
>Completely Speculative is the best description.
I was not considering buying gold at this moment. Just wanted to learn if Jon Stewart was
telling it straight.
Joseph Gwinn
> <ignoram...@NOSPAM.16758.invalid> wrote:
>
> My personal investment results from my investments that I had (and
> kept throughout) from year 2000, are roughly 90.4% total cumulative
> return. This does not include any additional investments that I made
> with savings from years after January 2000. Only the investments that
> I had in the beginning of the decade, which I still happen to be
> carrying.
A 90.4% cumulative return over the period 2000-2009 inclusive (money
almost doubled in 10 years) is equivalent to a compound interest of the
tenth root of 1.94, or 1.0685, or 6.9% growth per annum. That's pretty
solid, but it would be useful to compare this with the aggregate return
of treasury bonds, corrected for inflation.
Joe Gwinn
Hawke
The rule of thumb in investing is that you are supposed to be able to
double your money every seven years. That's considered a decent or
average return. So you can judge how well you have done by that measure.
Hawke
Ignoramus7943
> dca...@krl.org wrote:
>> On Jan 2, 9:38 pm, Ignoramus16758 <ignoramus16...@NOSPAM.
>> 16758.invalid> wrote:
>>
>>> While not as spectacular as the return on gold, I feel that 90% over a
>>> decade is a good result, considering the more typical outcomes, and it
>>> does establish a certain level of credibility as far as my investment
>>> mentality is concerned.
>>>
>>
>> Certainly a 90% return over this last decade is a good result.
>
> double your money every seven years. That's considered a decent or
> average return. So you can judge how well you have done by that measure.
There is many ways to evaluate investment performance. The one you
mentioned is an absolute measure.
There are also relative measures, for example, equity investors are
compared with S&P 500, bond investors with bond indexes, etc.
i
Ignoramus7943
You actually do not need to correct for inflation.
With 10 year bonds, I would suppose the return would be around 5% or
so, but more taxable. Just making a guess.
i
Ignoramus7943
Some get rich, some get poor.
i
Gunner Asch
But not if they buy low and sell high.
Correct?
Ignoramus7943
This is bullshit talk, I am sorry.
i
Gunner Asch
<ignora...@NOSPAM.7943.invalid> wrote:
Your admission is noted and forgiven.
Thanks for finally seeing it clearly.
Bill McKee
"Hawke" <davesm...@digitalpath.net> wrote in message
news:hhrh05$q4g$1...@speranza.aioe.org...
That is a 10% return and historically that is a lot greater than ever
earned.
pyotr filipivich
appear in rec.crafts.metalworking the following:
>>>>On 2010-01-03, John R. Carroll <nu...@bidness.dev.nul> wrote:
>>>>> Wes wrote:
>>>>>> Ignoramus16758 <ignoram...@NOSPAM.16758.invalid> wrote:
>>>>>>>> And yet I read countless Leftwingers all pissy and nasty about folks
>>>>>>>> who bought gold and have sat on it.
>>>>>>> So, do you recommend buying gold now? Or what are you saying,
>>>>>>> exactly?
>>>>>> I don't know if Jon Stewart was full of chit or not but he was poking
>>>>>> fun at gold sellers on Fox that had a 30% commision.
>>>>> You might want to reconsider Wes.
>>>>> He was poking fun at idiots buying and selling gold that were paying a 30
>>>>> percent premium to brokers.
>>>>Just curious, who are those brokers and where do they operate? I might
>>>>have missed something.
>>>>> Gold is a market for children and POG people.
>>>>What is POG?
>>>>> It has absolutely no basis, reality or use in the real world.
>>>>> Completely Speculative is the best description.
>>>>And pays no dividend and accrues no earnings.
>>> Neither do wheat, corn, oil, molassis or natural gas.
>>> Yet folks get rich buying and selling them,
>>> How does that work again?
>>
>>Some get rich, some get poor.
>
>But not if they buy low and sell high.
>
>Correct?
And some buy high and sell higher.
As Old Man Hardwick used to say "Everything will sell in seven
years".
tschus
pyotr
(It is a good deal, if both sides believe it was the other guy who got
taken.)
Joseph Gwinn
Ignoramus7943 <ignora...@NOSPAM.7943.invalid> wrote:
> On 2010-01-03, Joseph Gwinn <joeg...@comcast.net> wrote:
> >> On Sat, 02 Jan 2010 15:38:10 -0600, Ignoramus16758
> >> <ignoram...@NOSPAM.16758.invalid> wrote:
> >>
> >> My personal investment results from my investments that I had (and
> >> kept throughout) from year 2000, are roughly 90.4% total cumulative
> >> return. This does not include any additional investments that I made
> >> with savings from years after January 2000. Only the investments that
> >> I had in the beginning of the decade, which I still happen to be
> >> carrying.
> >
> > A 90.4% cumulative return over the period 2000-2009 inclusive (money
> > almost doubled in 10 years) is equivalent to a compound interest of the
> > tenth root of 1.94, or 1.0685, or 6.9% growth per annum. That's pretty
> > solid, but it would be useful to compare this with the aggregate return
> > of treasury bonds, corrected for inflation.
>
> You actually do not need to correct for inflation.
Sure you do if you want to see the true growth in wealth.
It's also useful for comparing stocks with bonds.
One example is the old rule of thumb that the no-risk interest rate
(which usually means US Treasury Bills) exceeds the rate of inflation by
approximately 1%.
> With 10 year bonds, I would suppose the return would be around 5% or
> so, but more taxable. Just making a guess.
It depends on your marginal tax rate (the tax on the next dollar of
income). If your tax bracket is above some number, municipal bonds
(munis) make a lot of sense, because munis are exempt from Federal
taxes, and from state taxes in the state of issue. If one buys munis
issued by one's state of residence, the interest is totally tax free.
For the record, while the stock market gets all the media attention, the
total value of the muni bond market is something like ten times larger.
By the way, Section R of today's (4 Jan 10) issue of The Wall Street
Journal covers sector-by-sector yields over the last year, and over the
last decade, in some detail. The clear winner, with 279.6% gain in ten
years, is Gold (COMEX Futures).
Joe Gwinn
Ignoramus20205
> In article <rtmdnVi1DvZjyNzW...@giganews.com>,
> Ignoramus7943 <ignora...@NOSPAM.7943.invalid> wrote:
>
>> On 2010-01-03, Joseph Gwinn <joeg...@comcast.net> wrote:
>> >> On Sat, 02 Jan 2010 15:38:10 -0600, Ignoramus16758
>> >> <ignoram...@NOSPAM.16758.invalid> wrote:
>> >>
>> >> My personal investment results from my investments that I had (and
>> >> kept throughout) from year 2000, are roughly 90.4% total cumulative
>> >> return. This does not include any additional investments that I made
>> >> with savings from years after January 2000. Only the investments that
>> >> I had in the beginning of the decade, which I still happen to be
>> >> carrying.
>> >
>> > A 90.4% cumulative return over the period 2000-2009 inclusive (money
>> > almost doubled in 10 years) is equivalent to a compound interest of the
>> > tenth root of 1.94, or 1.0685, or 6.9% growth per annum. That's pretty
>> > solid, but it would be useful to compare this with the aggregate return
>> > of treasury bonds, corrected for inflation.
>>
>> You actually do not need to correct for inflation.
>
> Sure you do if you want to see the true growth in wealth.
The question above was comparing returns for the same period, with one
another.
i