Showing posts with label Ironman. Show all posts
Showing posts with label Ironman. Show all posts

Thursday, February 22, 2018

Ironman estimates stock repurchases by corporate America of $628 billion in 2018 due to tax cuts


What we find is that 2018's projected total of $628 billion in buybacks will break the previous record of roughly $589 billion worth of stock repurchases that was set by U.S. corporations in 2007, which would work out to be about a 7% increase over that previous record.

Time will tell if share repurchases were the right thing for the companies that are choosing this action to have done with the benefits they received from U.S. corporate income tax reform.

Thursday, December 10, 2015

Ironman thinks the decline of the middle class is demographic, explained by fewer births between 1964-84


In other words, if you have fewer people in the middle of your data set (Generation X), you'll necessarily have a slump in the middle between old rich Baby Boomers and the more numerous than Gen X Generation Y, which is young and poor, as is everyone at that age.

The middle class decline is therefore most likely to be temporary.

Saturday, December 13, 2014

Obama's war on growth: Per capita measure shows GDP didn't recover to 2007 level until 3Q2013

So says Ironman, here:

"Going by this measure we see that it wasn't until the third quarter of 2013 that the U.S. economy really recovered to its pre-recession level. And then, it has only been since the second quarter of 2014 that it has grown beyond that level.

"The interesting thing is that tracking the GDP per capita measure this way would more closely match the perceptions of the American people regarding the overall health of the U.S. economy. Say as measured by the University of Michigan's Consumer Sentiment Index, which returned to its prerecession levels just a few months ahead of real GDP per capita.

"Contrary to what at least one particular economist [Jonathan Gruber] and his fellow travelers [Bill Maher/Kathleen Sebelius] might think about their cognitive abilities and financial literacy, regular Americans would seem to be pretty capable of collectively assessing the real condition of the U.S. economy."

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Yes, self-perceptions matter.

Coincident with the extraordinarily long 6 year wait for the real economy to recover, the self-identification of the American people by lower class in January 2014 has swelled by 50 million since 2008, according to the results of a regular Pew survey, showing just how many people have died on the vine of a militant, leftist Obama administration and Democrat Party bent on destroying the middle class.

When the New York Times suddenly tells you after the election that 30 million prime-working-age Americans 25-54 aren't working, you know that where there's smoke, there's fire. With fewer than 5 million job openings in the country for those 30 million, legalizing 11 million illegal aliens isn't just an act of charity toward some, but a declaration of war against all.

Barack Obama has been burning down the house, one family at a time.


Saturday, November 29, 2014

Bonds still beat stocks over the last 15 years

"King Kong" 1933
Your average annual nominal return from the S&P500 with dividends fully reinvested comes to 4.61% from October 1999 through October 2014, per Ironman.

Your average annual nominal return from the Vanguard Intermediate Term Bond Index Fund (VBIIX) for the fifteen years to 11/28/14 has been 6.48%, per Morningstar.

That's a 40% better rate of return from bonds than stocks on average.

"Hey, what's this show about, anyway?
"I don't know — they say it's some big gorilla.
"Oh, geez — ain't we got enough of them in New York?"

Tuesday, October 21, 2014

Since the last market peak in August 2000, real returns from stocks have averaged just 1.61% per year through August 2014

politicalcalculations.blogspot.com
























The inflation-adjusted market peak was in August 2000 at S&P500 2044.67, still unequalled (2011.36 is as high as we've gotten). Through August 2014, your average real return from stocks, that is, your return adjusted for inflation with dividends fully reinvested along the way, has been just 1.61% per year for 14 years. Without dividend reinvestment, your return actually has been negative annually because of inflation. Nominally your return has been 3.95% per year, dividends reinvested.

Compare bonds over the last 15 years to date. Take VBMFX, Vanguard's Total Bond Market Index Fund. Morningstar shows your nominal 15 year return this morning at 5.49% per annum. VBIIX, Vanguard's Intermediate Term Bond Index Fund, has done even better, at 6.59% per annum, nominal.

Clearly, bonds have beaten stocks over the long haul since 2000. And valuations tell you why. Yardsticks such as the Shiller p/e have not dipped below 15 to any meaningful degree over the whole period, meaning stocks have been pricey for the performance you get. The higher the price, the poorer the return.

Expect the same from stocks going forward as long as valuations remain as elevated as they are. Today's Shiller p/e starts out at 24.95.

Monday, July 14, 2014

Buy and hold investors from the Aug.'00 high have made all of 1.32%/yr through May 2014

The August 2000 level of 2045 was the inflation-adjusted all-time high for the S&P500. Average annual returns adjusted for inflation have been a paltry 1.32% since then, indicating how steeply valued stocks were at the time: The Shiller p/e was 42.87. h/t politicalcalculations.blogspot.com

Average real rate of return from stocks since 2000 highs didn't turn positive until May 2013

Through April 2013 your real return annually was negative on average. August 2000 is the benchmark for the inflation-adjusted high for the S&P500 at 2045. Through May 2013 your real return annually turned positive on average. h/t politicalcalculations.blogspot.com

Tuesday, June 10, 2014

Real returns from stocks since April 2000 have been just 1.3% per annum

Stock market investors who think market peaks like now are good times to add large sums to the equity side might want to consider what would have happened had you gone all in with new monies in the spring of 2000.

Today's real S&P500 for April 1, 2000 was higher than it is today: 2,022.46 then vs. 1951.27 now. The real S&P500 would go on to exceed that level only once: on August 1, 2000 at 2,037.97. It's been a pretty rough ride since then even with the spectacular 5-year run we've just had, added in.

Ironman here provides an excellent tool to calculate your returns in the S&P500 since April 2000 to April 2014, the most recent date available. They are horrible: just 1.3% per annum real, 3.68% not adjusted for inflation.

By way of contrast, Morningstar reports that Vanguard's Total Bond Market Index Fund through yesterday has produced a nominal 15-year return of 5.34% per annum.

Tuesday, March 18, 2014

Your 15 Year Real Return From The S&P500: Just 2% Per Year 1999-2014

The inflation-adjusted return from an investment in the S&P500 from January 1999 to January 2014 is just 2% per year.

At that rate it takes 35 years to double your fortune in real terms.

Calculate your return here.

Wednesday, December 18, 2013

John Hussman Is Right: High Valuations Since The Late 1990s Have Coincided With Smaller S&P500 Returns

Here's Hussman:

Yes, several reliable valuation measures have hovered at much higher levels since the late-1990’s than were generally seen historically. But that in itself is not evidence that these historically reliable valuation measures are “broken.” It matters that those high valuations have been associated with a period of more than 13 years now where the S&P 500 has scarcely achieved a 3% annual total return.

Here's Ironman's chart of S&P500 returns for the 15 years ended October 2013 showing a real, that is inflation-adjusted, total annual return with dividends fully reinvested of . . . 2.88%:

click to enlarge















Here's Morningstar's chart showing how much better you'd have done in intermediate term bonds like Vanguard's VBIIX, 5.88% nominal per year over the last 15 years (roughly 3.4% real), and that's including this year's bond slaughter:

click to enlarge














Here's the Shiller p/e as of this morning, clearly and excessively above the mean level of 16.50 for most of the time from the 1990s:

click to enlarge















Hussman says investors should expect poor returns from stocks going forward:

[S]tocks are currently at levels that we estimate will provide roughly zero nominal total returns over the next 7-10 years, with historically adequate long-term returns thereafter.

Tuesday, December 3, 2013

Since 2000, Your Real Rate Of Return From Stocks Has Been Just 0.67% Annually

The inflation-adjusted rate of return from the S&P500 with dividends fully re-invested from September 2000 to September 2013 has been just 0.67% annually.

Check for yourself, here.

Saturday, October 5, 2013

The 5-year Anniversary of Jim Cramer's Worst Advice Ever

When TARP was signed by George Bush on Friday, October 3, 2008, the S&P500 closed at 1099 after falling dramatically in September during the events of the banking panic.

Jim Cramer came on television the next Monday morning and advised a national audience that if they needed their money in stocks in the next five years, they'd better sell.

They did sell, and the market continued to plunge . . . all the way into 2009 to the March lows. You might even say a lot of people panicked because of Jim Cramer.

But 5 years later, the S&P500 market index alone is up 54%, not counting dividends. And if you had stayed in the market from August 2008 to August 2013 and fully re-invested your returns, you'd be UP 6.4% per year in inflation-adjusted terms, and 7.8% per year nominal.

Thanks for nothing, Jim!

Thursday, August 29, 2013

Ironman Arrives At The Same Conclusion Reached By The True Born Sons Of Liberty

TARP is fascism
At Real Clear Markets, here:


The United States would appear to be well on its way to adopting fascist Italy's political-economic system, favoring the politically-connected while starving entrepreneurs out of the economy. Although today in America, we call it "crony capitalism". And the people who practice it "progressives".


Do you think we should start calling it what it really is?


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This blog was born of the observation here in 2009, and I think first used the term in the specifically financial sense involving not just banking, but housing, a year later, here. Since those days, however, we've decided England invented fascism long before Mussolini did and founded America on the principle, but the English undoubtedly got it from the great old Roman idea of the patron-client relationship.


Sunday, August 11, 2013

Your Real Return In Stocks Since 2000? Just 0.32% Per Year!

Sad, but true.

Check for yourself, here.

Wednesday, May 8, 2013

Cyclically-Adjusted p/e Above 20 Forecasts Near-Zero 10yr Returns

As discussed here by Mark Hulbert:


Where does the CAPE stand today?

It currently is at 23.3, which is 41% higher than its historical average. While the CAPE’s current level is not as high as the 40+ readings that were registered at the top of the internet bubble, it does not bode well for the next ten years. On average over the last century, the S&P 500 has produced a 10-year inflation-adjusted return of close to zero whenever the CAPE has been above 20.

To be sure, note carefully that this is a 10-year forecast. Even if it turns out to be accurate, it doesn’t mean the market will decline in a straight line between now and 2023. It wouldn’t be inconsistent with this forecast for the market’s impressive recent rally to continue for a while longer, for example.

politicalcalculations.blogspot.com
Hulbert is right. On March 1, 2000 the Shiller p/e stood at 43.22. For the thirteen years from March 2000 to March 2013, your return in the S&P500, adjusted for inflation and with all dividends re-invested, as been exactly +0.05% per annum.

Sort of like investing in a money market fund right now.

Ouch.

By the way, the Shiller p/e this morning stands at 24.14.



Sunday, March 24, 2013

Your Real 5-yr. Rate Of Return In Stocks Has Been Poor, Actually

The real rate of return in the S&P500 for the five years from February 2008 to February 2013 hasn't been all that good, actually. Just 2.61% per year. And long term investors have had to stomach all the volatility just to get that measly return. Meanwhile investors in the Vanguard Total Bond Market Index Fund have received returns in excess of 5%, while being able to sleep at night.

Has it all been worth it, Ben?

Calculator available here.

Sunday, February 24, 2013

Why The Shiller p/e Might Mean The Market Has Room To Run

The market might have room to run if excluding the bubble period from the calculation of the Shiller p/e is any guide.

So John Hussman, here:

"Excluding the bubble period since mid-1995, the average historical Shiller P/E has actually been less than 15."

That means the bubble period skews the calculation of today's historical average of 16.46 upward by something like 9%. So with a current Shiller p/e of 23.35 which looks backward incorporating bubble-era p/es into its calculation, a discount of 9% yields a truer Shiller p/e presently of something more like 21.25, which could mean there is still considerable upside potential in the market.

Today's Shiller p/e would have to rise to about 26.4 to reflect the old upper range redline of 24 identified by Hussman as a danger zone.

Interestingly, the March 1, 2009 Shiller p/e of 13.32 was therefore more like 12.1, quite the buying opportunity indeed, though nowhere near the 7 identified by Hussman as that rare thing marking the buying opportunity of a lifetime.

I wish I had had the courage to get in in March 2009. The real average annual rate of return in the S&P500 from then to January 2013 has been +19.14%, simply amazing. But as late as May 2010 people like Richard Russell were telling us to get out of debt and get completely liquid because technical analysis was predicting Armageddon was 6 months away. By August he had changed his tune.

Near term I am somewhat less pessimistic than I was, if only because a real blow-off top looks more definable than before. I'm still keeping my powder dry.

Sunday, January 27, 2013

S&P500 Buy And Hold Investors Since October 2007 Are Down 1.14% Per Year

Read it and weep, here.

The real rate of return in the S&P500 from October 2007 through 2012, five years and two months, is negative 1.14% per year with all dividends reinvested. Stories are circulating that individual investors are beginning to get back into the market. With the Shiller p/e above 23, they're going to get what's coming to them, imho. I've been 90% out of the market since late 2006, and intend to stay that way until a genuine buying opportunity arises, but this sure as hell isn't one of them.

The story is even worse going back to January 2000: real rate of return down 0.56% per year for 13 years January 2000 through 2012.

The S&P500 Is Up 12.31% Per Year In Obama's First Term

You can use the tool which generated this graphic here, anytime you want for anytime you want.

I measure November on November because elections mark the turning point psychologically, which counts for more than anything imho.

Elites have benefitted handsomely under Obama, which is what you would expect from a fascist. If that's too harsh for you, supply "national socialist" or "corporatist".

I reported in September, here, that stock market performance under Obama is the 4th best since Harry Truman, based on incomplete data showing inflation adjusted returns to date. Now that it's the new year, the data is in, but the conclusion is the same. Even though he slips from 12.66% to 12.31% for per annum returns, he's still safely in 4th place behind Truman, Clinton and Eisenhower.

Free market capitalism isn't practised in the United States and hasn't been since at least Woodrow Wilson. The corporatist model in the United States is mediated primarily through banking and the institution known as the Federal Reserve, which attempts to manipulate the economy through control of money, lending and interest rates, rewarding those first in line the most, the bankers, and leaving a few crumbs for the rest of us in a descending pecking order: corporations, unions, insurance companies, etc.  To a lesser extent, the tax code is used to reward friends and punish enemies, which is why it has grown so enormous in size and complicated to follow. The fascists' biggest coup in recent years was the tax reform of 1997 and the banking deregulation of 1999, both under Clinton and Gingrich, which unleashed a torrent of capital stored in decades of the housing stock from which elites skimmed and got very rich. You know it as the housing bubble, the result of the bursting of which has been 5 million homes repossessed and massive unemployment on a scale not scene since FDR. As a socialist, Obama is entirely happy with this arrangement because it offers him political opportunities. Idealism is merely a tool. He uses it to get power and get rich. And like dopes, Americans continue to hand it over, election after election. And some of these prisoners even grow to love their jailers.