econintersect.com
       
  

FREE NEWSLETTER: Econintersect sends a nightly newsletter highlighting news events of the day, and providing a summary of new articles posted on the website. Econintersect will not sell or pass your email address to others per our privacy policy. You can cancel this subscription at any time by selecting the unsubscribing link in the footer of each email.



posted on 05 October 2017

Are You Ready For 0% Return? For 10 Years?

Written by , Rick's Picks

Market's Hot Streak Still Lags Cleveland's

The Dow Industrials rose on Thursday for an eighth straight day - a rare feat, although not nearly so rare as the Cleveland Indians’ 22 straight victories this past season. In fact, the Dow has had nearly a dozen streaks lasting eight days.

22.cleveland


Please share this article - Go to very top of page, right hand side, for social media buttons.


What is the significance of this latest one? Mainly, that nearly everyone with money in the stock market made a little more of it the easy way. Much as they’ve been doing for eight-and-a-half years. In a bull market, it would seem, we are all rentiers with a steady stream of passive income derived from our respective chunks of the rock.

Click for large image.

There are quite a few more of us with skin in the game than you may have imagined. We’ve all heard that “the public" has yet to go all in. In fact, collectively we are in stocks up to our eyeballs, according to Peter Eliades, editor and publisher of Stockmarket Cycles. In the latest edition of his newsletter, Peter includes a chart that shows stocks as a percentage of household financial assets. Other than during the years of the dot-com boom, readings are as high as they have been at any time during the last 65 years.

‘Most Overvalued Market in History’

In the same newsletter, he serves up an interesting quote from stock a colleague, John Hussman:

“What investors presently take as a comfortable environment of pleasant market returns and mild volatility is actually, quietly, the single most overvalued point in the history of the U.S. stock market."

Peter notes:

“Don’t make the mistake of thinking that Hussman’s parameters for market valuations are based on simple P/E ratios or other orthodox valuation parameters," “He has made a strong case that his valuation methodology is capable of assessing the markets potential over a following 10 to 12 year period. He uses a ratio of nonfinancial market capitalization to corporate gross value-added which includes estimated foreign revenues and which he describes as essentially measuring corporate revenues without double counting intermediate inputs. Sounds a little complicated, does it? Indeed, it may be, but that model is now calling for a 10 to 12 year annualized return on the S&P around the zero level. Compare that to a historic return of close to 10%, including dividends, and you should be able to glean what a miserable decade or more his valuation model foresees."


If you are not a subscriber, click here for a free two-week trialthat will allow you to see the tout, and also to enter the Rick’s Picks chat room, where great traders from around the world swap timely ideas 24/7.


>>>>> Scroll down to view and make comments <<<<<<

Click here for Historical Investing Post Listing










Make a Comment

Econintersect wants your comments, data and opinion on the articles posted. You can also comment using Facebook directly using he comment block below.




Econintersect Investing








search_box
Print this page or create a PDF file of this page
Print Friendly and PDF


The growing use of ad blocking software is creating a shortfall in covering our fixed expenses. Please consider a donation to Econintersect to allow continuing output of quality and balanced financial and economic news and analysis.







Keep up with economic news using our dynamic economic newspapers with the largest international coverage on the internet
Asia / Pacific
Europe
Middle East / Africa
Americas
USA Government





























 navigate econintersect.com

Blogs

Analysis Blog
News Blog
Investing Blog
Opinion Blog
Precious Metals Blog
Markets Blog
Video of the Day
Weather

Newspapers

Asia / Pacific
Europe
Middle East / Africa
Americas
USA Government
     

RSS Feeds / Social Media

Combined Econintersect Feed
Google+
Facebook
Twitter
Digg

Free Newsletter

Marketplace - Books & More

Economic Forecast

Content Contribution

Contact

About

  Top Economics Site

Investing.com Contributor TalkMarkets Contributor Finance Blogs Free PageRank Checker Active Search Results Google+

This Web Page by Steven Hansen ---- Copyright 2010 - 2017 Econintersect LLC - all rights reserved