Are the recent highs in the DOW just a sign of inflation?

[rehmwa 2]

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Have your living costs really gone up 45% in the past 7 years? Seems like a stretch to me.

Nonsense, young kid goes to college and lives off of mom and dad. Or, lives in a hole while getting degree.

7 years later, slightly less young kid has been in a decent job for 3 years and buys his first house, a new, rather than used, car, and maybe finds a wife and a kid or two to raise.

Check his profile and see if 'time in sport' indicate someone possibly in their middle to late 20's. Or in their early 30's with a less fiscally beneficial degree.

a big increase in the cost of living over a few years in this timeframe is very normal - due to CHOICES the individual makes

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Driving is a one dimensional activity - a monkey can do it - being proud of your driving abilities is like being proud of being able to put on pants

[NCclimber 0]

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Something to consider: the concept of purchasing power parity of the Dow. On a purchasing power basis the Dow isn't even where it was in 2000.

To figure what level the Dow needs to be at in order to achieve the same purchasing power parity as the 2000 Dow just follow this link to the Federal Reserve and find their inflation calculator (left side).
http://www.minneapolisfed.org/Research/data/us/calc/index.cfm

Enter 11,723 for a starting value (2000).
Put in 2007 for an end date. Using the Fed's own calculator of inflation, the Dow would have to hit nearly 14,000 to match the 2000 Dow peak.

Well whaddaya know. Last look it was 13,999.

[algboy 0]

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Something to consider: the concept of purchasing power parity of the Dow. On a purchasing power basis the Dow isn't even where it was in 2000.

To figure what level the Dow needs to be at in order to achieve the same purchasing power parity as the 2000 Dow just follow this link to the Federal Reserve and find their inflation calculator (left side).
http://www.minneapolisfed.org/Research/data/us/calc/index.cfm

Enter 11,723 for a starting value (2000).
Put in 2007 for an end date. Using the Fed's own calculator of inflation, the Dow would have to hit nearly 14,000 to match the 2000 Dow peak.

Well whaddaya know. Last look it was 13,999.

13971.55 as of end of trading today. BFD. We're almost back to 2000. If you drink Jim Jones-flavored KoolAid everything is just grrrrrraate!

[kallend 2,112]

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Something to consider: the concept of purchasing power parity of the Dow. On a purchasing power basis the Dow isn't even where it was in 2000.

To figure what level the Dow needs to be at in order to achieve the same purchasing power parity as the 2000 Dow just follow this link to the Federal Reserve and find their inflation calculator (left side).
http://www.minneapolisfed.org/Research/data/us/calc/index.cfm

Enter 11,723 for a starting value (2000).
Put in 2007 for an end date. Using the Fed's own calculator of inflation, the Dow would have to hit nearly 14,000 to match the 2000 Dow peak.

Well whaddaya know. Last look it was 13,999.

13971.55 as of end of trading today. BFD. We're almost back to 2000. If you drink Jim Jones-flavored KoolAid everything is just grrrrrraate!

Since Bush took office you could have made more money speculating against the $US than investing in the DOW basket of stocks.

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The only sure way to survive a canopy collision is not to have one.

[kelpdiver 2]

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Since Bush took office you could have made more money speculating against the $US than investing in the DOW basket of stocks.

Of course it's always easier to make more money than the market in hindsight.

Also - don't think the indexes reflect the dividend payouts that would have been received. Only ~2% per year, but at least it's something, and in a DRIP would have done a bit better than 2% with the crash in 2002.

[kallend 2,112]

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Since Bush took office you could have made more money speculating against the $US than investing in the DOW basket of stocks.

Of course it's always easier to make more money than the market in hindsight.

I did, and not in hindsight, thank you.

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Also - don't think the indexes reflect the dividend payouts that would have been received. Only ~2% per year, but at least it's something, and in a DRIP would have done a bit better than 2% with the crash in 2002.

Well the point is that all the righties crowing about the wonderful state of the economy seem to forget that the $US has fallen by a pretty large amount since 2001.

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The only sure way to survive a canopy collision is not to have one.

[kelpdiver 2]

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Of course it's always easier to make more money than the market in hindsight.

I did, and not in hindsight, thank you.

good for you. But it's still market timing and speculation. Betting on currency rates is no joking matter. Seems much better to make that bet via international ETFs.

[kallend 2,112]

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Of course it's always easier to make more money than the market in hindsight.

I did, and not in hindsight, thank you.

good for you. But it's still market timing and speculation. Betting on currency rates is no joking matter. Seems much better to make that bet via international ETFs.

I don't see one form of betting as any better or worse than any other form. Every time stock changes hands, each party to the transaction is betting.

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The only sure way to survive a canopy collision is not to have one.

[joedirt 0]

Which currency or meatal did you use against the dollar if you don't mind telling? I won't criticize ... I promise.

[kelpdiver 2]

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good for you. But it's still market timing and speculation. Betting on currency rates is no joking matter. Seems much better to make that bet via international ETFs.

I don't see one form of betting as any better or worse than any other form. Every time stock changes hands, each party to the transaction is betting.

I wasn't making a value judgement, just noting that currency exchange, espcially betting against the dollar, one of the most desireable currencies on the planet, is a very high risk gain. People have lost billions trying, sometimes billions they didn't have.

Buying a piece of a company is a bit different. And buying an entire index has a much lower beta.

Like I said, good for you, but it's crappy advise to give. No casual investor should be dabbling in derivatives or currency. And trying to bet against the dollar now is like trying to buy dotcoms in 2000. People as an aggregate tend to trail market returns because they jump on the hot sector after its already started cooling off.

[NCclimber 0]

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Well the point is that all the righties crowing about the wonderful state of the economy seem to forget that the $US has fallen by a pretty large amount since 2001.

By time honored measures, like the major indexes, unemployment, inflation and GDP, we're doing pretty good. Not fantastic, but pretty darn good.

Since you seem to think the declining dollar is indicative of a much more dire economy, why don't you tell us why it's so horrible.

Please don't dodge this question repeatedly and then come back with a bunch of conditional parameters what were not in your original claim. That whole business of making a blanket statement and then saying what you really meant was blah, blah, blah is so lame.

[SkyDekker 1,465]

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Does anyone else here think that the record highs in the Dow Jones Industrial Average are directly related to the falling US dollar?

Without any doubt whatsoever.

But, I don't think it is due to inflation. I think the low US$ is causing a large increase in foreign investors buying on the US markets.

The combination of a stock market gain combined with a exchange rate gain can be very lucrative.

[NCclimber 0]

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You now know more about inflation than than 99% of your friends

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13971.55 as of end of trading today. BFD. We're almost back to 2000. If you drink Jim Jones-flavored KoolAid everything is just grrrrrraate!

Are others as impressed with you as you seem to be?

[NCclimber 0]

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Does anyone else here think that the record highs in the Dow Jones Industrial Average are directly related to the falling US dollar?

Without any doubt whatsoever.

But, I don't think it is due to inflation. I think the low US$ is causing a large increase in foreign investors buying on the US markets.

The combination of a stock market gain combined with a exchange rate gain can be very lucrative.

But the exchange rate continues to work against foreign investors. The falling dollar offsets gains in the stock market.

[SkyDekker 1,465]

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But the exchange rate continues to work against foreign investors. The falling dollar offsets gains in the stock market.

Right now yes. But what about 5 years from now?

[NCclimber 0]

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But the exchange rate continues to work against foreign investors. The falling dollar offsets gains in the stock market.

Right now yes. But what about 5 years from now?

For the last four years (and especially the last seven) foreing dollars in the Dow hasn't been that great.

IOW Right now... and for the last seven years.

[SkyDekker 1,465]

That graph doesn't really explain what it is showing.

There would also be a fair share of indirect investments etc.

[NCclimber 0]

Sorry about that. The chart is of monthly bars. The black ones are for the Dow. The purple ones are for the Dollar index.

While the Dow has been strong, so has the FTSE and other overseas indexes.

[kallend 2,112]

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Well the point is that all the righties crowing about the wonderful state of the economy seem to forget that the $US has fallen by a pretty large amount since 2001.

By time honored measures, like the major indexes, unemployment, inflation and GDP, we're doing pretty good. Not fantastic, but pretty darn good.

Since you seem to think the declining dollar is indicative of a much more dire economy, why don't you tell us why it's so horrible.

Please don't dodge this question repeatedly and then come back with a bunch of conditional parameters what were not in your original claim.

Since my original claim was: Since Bush took office you could have made more money speculating against the $US than investing in the DOW basket of stocks. (which is demonstrably true), your demand is totally irrelevant and silly.

[NCclimber 0]

Oh!

I thought it was "real revenues have NOT gone up."

You're too much!

I do love how you magically link statements to suit your fancy. LOL

[algboy 0]

That's what they all tell me.

“Keep your elbow up!"

[kallend 2,112]

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Oh!

I thought it was "real revenues have NOT gone up."

You're too much!

I do love how you magically link statements to suit your fancy. LOL

I aleady provided data on that one.

I realize your tactic is to request the same thing posted over an over in every new thread, but some of us actually have memories.

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The only sure way to survive a canopy collision is not to have one.

[NCclimber 0]

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Oh!

I thought it was "real revenues have NOT gone up."

You're too much!

I do love how you magically link statements to suit your fancy. LOL

I aleady provided data on that one.

Yeah. You provided a bunch of conditional factors (some quite absurd) to give an isolated situtation where your claim fit.

As a stand alone statement, which is how you initially made it, the claim is complete bullshit... or, at best, unsupported.

This latest ploy ranks right up there with you producing google results for colin powell my lai as proof he played an active role in trying to cover up the my lai massacre.

It seems like every few weeks you make some bullshit claim that you won't defend or admit you got wrong. Hmm. Why is that?

[NCclimber 0]

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I realize your tactic is to request the same thing posted over an over in every new thread, but some of us actually have memories.

If you'd just answer what typically starts out as a straightforward, civil request, we could avoid all this silliness.

Of course, that might require you to own up to being wrong.

Anything is possible.