1400 S&P

Just buy and hold, and enjoy your 370% ROI after 17.5 years. You're welcome! 😀

Who really cares - SP500 index plays are long term set and forget it type of decisions. Trying to predict a bottom is next to impossible and there's not enough volatility there to make a lot of money short term anyways.

Is your thesis and has it always been that the government will bail us out or print us out of any major economic catastrophes?

Because without intervention in the global financial crisis (mostly unjustified), who knows how many companies would have gone bankrupt. Same can be said for covid to a lesser degree.

My thesis is the stock market has gone up since its inception and will continue to do so. A few bumps in the road for sure but the trend is clear.

I wonder what you think the financial world and your portfolio would have looked like without massive bailouts of levered companies risking way more than they ever should have in the early 2000s?

Permabears aren't sick. They just don't understand we are not actually living under a capitalistic free market.

That wasn't a bump in the road, that should have been the end of that road.

Ideally, the companies would be liquidated, and their assets sold to companies that are actually producing goods and services that people want. We have a short, sharp "panic" like we had in the 19th century, then recovery and life goes on. Even better, the massively leveraged companies wouldn't never get to that point in a world where bailouts were not a thing.

(When I first saw this I didn't realize that it was a bump of a 17 year old OP.)

Me neither 😀 But that fact makes my point stronger. Market goes up! Does the fed/govt show its hand? Of course they do! Even more reason to believe in the never ending uptrend.

Lotsa companies did go down in the GFC. Sick/bad companies always do. But new stuff steps in on the neverending growth supercycle. The biggest companies aren't that old and the oldest companies arent that big.

FWIW the real “ennemies” are the “too big too fail” corporations.
They should break them up so u end up not being afraid to let them fail .

Today u end up being obligated to bail them out , so u encourage fraud and mal investment .
Preventing bad corporations to pay the price and preventing liquidation of those they should be .

No wonder so much zombies companies exist too.
I just find it strange many Americans hates socialism’s so much but yet seem to be unable to acknowledge they already have it at the corporations level .

Yes, its been asked many times before on this sub forum but I do wonder what the historical growth of the S&P would look like without money printing/currency debasement. They are surely closely linked to the point of near identical graphs, but stocks must carry some growth on top. These are profitable companies in the S&P.

Going forward if you were to make an index of companies that are

1) Profitable
2) Hold bitcoin on the balance sheet (doesnt have to be an outright treasury company like Strategy, just putting spare cash into btc qualifies)

I think this would outperform the S&P over the next 5-10 years for sure. Personally going forward I will avoid investing in companies that ignore bitcoin.

I've seen somewhere that british stocks delivered about 5 or 6% annual real returns, almost everything coming from dividends, over the 19th century, with that period being mostly deflationary.

Not sure how reliable tradingview is for very long term data, but:

Gold at the end of 1971: $43.850
Gold now: $4,211.34
9,503.96%
CAGR: 8.82%

S&P 500 at the end of 1971: 102.09
S&P 500 now: 6,854.34
6,614.02%
CAGR: 8.10%

So, measured against gold, stocks lost over that period.

Now, let me try to measure over a period that does not end in a massive bull market for gold, 1971-2015:

Begin: $43.850
End: $1,061.19
2,320.04%
CAGR: 7.51%

S&P 500: 102.09
End: 2,043.94
1,902.09%
CAGR: 7.04%

None of this includes dividends though, but still, measured against a "strong currency", stocks didn't do that well as it might look like at first glance.

What if we compare someone who bought gold at the top of the 70s bull market, at 1980, and sold it today, with stocks over the same period?

Gold at 1980: $591.30
Gold at 2025: $4,211.34
612.21%
CAGR: 4.45%

S&P 500: 135.76
2025: 6,854.34
4,948.86%
CAGR: 9.10%

Ofc here I chose the worst possible starting date for gold, and one of the best for stocks. So, even if we are at a massive bull market for stocks, gold is so high now that it is probably not the greatest idea to sell stocks to buy gold, and stocks are probably the "safest" bet, even when they do worse. Or, at least we might want to do something like the permanent portfolio, all weather etc.

One could argue that gold at the end of 1971 was massively undervalued.

1972: The Chicago Mercantile Exchange (CME) launched futures trading in currencies, paving the way for other commodities.
1974: The Commodity Exchange (COMEX) in New York (now part of CME Group) started trading gold futures, coinciding with the end of the U.S. ban on gold ownership.

I have 20/20 vision. Gold from 1999/now also did substantially better than stocks. Still, the moral of the story seems to be that, if you can identify the point where no one wants gold, especially if stocks are already in a multi year bull market, gold will probably do as well or better over the long run.

There are risks in owning gold that maybe I am not quantifying well, and could explain part of the outperformance. You may lose it, it may get stolen, governments might confiscate it, cost of storage/security/insurance etc etc.

Ya don't say?

I'd like to have it very precise 😀

For the period 1999-now I have the graph with total returns.

640.99% returns, or 8.0076% compounded yearly for the S&P 500, vs 1369.885%, or 10.89% compounded, for gold.

Like bitcoin in 2010.

https://totalrealreturns.com/n/VFINX?

Anyone can cherry pick dates. I just punched a couple into GROK to see?

Jan 1, 2009 (becase i thought it would prove my point)
The S&P 500's total return outperformed gold by 523.68 percentage points (907.21% - 383.53%).

Then I tried the day I was born (ie. my lifetime so far)
3/6/1954
The S&P 500's total return outperformed gold by 186,361.48 percentage points (198,124.02% - 11,762.54%).

Then I tried the day I graduated from college
5/18/1975
The S&P 500's total return outperformed gold by 186,361.48 percentage points (198,124.02% - 11,762.54%).

Last one I tried was when I graduated from Grad school
6/9/87
The S&P 500's total return outperformed gold by 4,448.05 percentage points (5,282.25% - 834.20%).

So I tried one cherry pick (2009) and 3 random dates from my life. Bottom line?
S&P takes a huge dump on gold

Hmmm? seems to be a glitch in the matrix as 1954 and 1975 gave same number? I guessits having a problem going back that far. But istill like stock over gold anytime.

Tried one more "random" date. The day I got out of the Navy.
8/8/82
The S&P 500's total return outperformed gold by 13,541.14 percentage points (14,692.61% - 1,151.47%).

Every random "meaningful" date in my lifetime was a much better day to buy stocks rather than gold.

Return by decade, it is volatile but S&P clear winner. Gold is on a current heater but don't be fooled by randomness. The 70's were particlarly bleak for stocks and good for gold. Also the 2000's sucked for stock as it had both the dot com bubble burst as well as the GFC. There are times when either asset can be great or suck balls. Conditions change and will favor one or the other. Diversificaion is key though and you probably have both as both are historically rising assets. But long term? Give me the growth potential and dividend return instead of a brick sitting in a safe somewhere while I hope it increases in value.

Decade
S&P 500 Total Return (%)
Gold Return (%)
Difference (%)

1950s
491.86
-12.42
+504.28 advantage s&p

1960s
110.69
16.31
+94.38 advantage s&p

1970s
77.69
1,019.59
-941.90 advantage gold

1980s
395.00
-12.63
+407.63 advantage s&p

1990s
425.60
-27.63
+453.22 advantage s&p

2000s
-9.14
274.72
-283.86 advantage gold

2010s
252.92
35.73
+217.18 advantage s&p

2020s (to 2025)
131.86
186.76
-54.90 advantage gold

Yes, and if the collapse of government printed money in the western world is potentially one of the next crises facing the financial world which asset(s) will be best?

If you look historically at cases where this happened in a contained way before like the Weimar Republic then it follows logic. All assets rose when priced in the fiat that was becoming worthless. Those that owned them became wealthy. Those that realised what was happening and took out debt in fiat to buy the assets became the wealthiest.

Google AI had this to say

They are not going to stop printing money imo. Doesn't it follow logic that the best asset to hold going forward will be the one they can't make more of, costs nothing to hold and is unconfiscatable?