Following yesterday’s look at performance by years, Eric Willer in our Dallas office sent me these charts — they are quite instructive as to how markets have performed over various decades:


Annualized S&P500 Returns by Decade


Return History for Common Stocks 1926-2009 (inflation adjusted)

Average Annually Compounded Return = 6.7%

All charts courtesy of PPCA Inc.


Good stuff — thanks, Eric!


Perspectives on 2009 and Beyond (PDF)
Ron Surz
Horse’s Mouth, January 4, 2010

Category: Investing, Technical Analysis

Please use the comments to demonstrate your own ignorance, unfamiliarity with empirical data and lack of respect for scientific knowledge. Be sure to create straw men and argue against things I have neither said nor implied. If you could repeat previously discredited memes or steer the conversation into irrelevant, off topic discussions, it would be appreciated. Lastly, kindly forgo all civility in your discourse . . . you are, after all, anonymous.

19 Responses to “Putting the 2000-2009 Market Decade into Perspective”

  1. Steve Barry says:

    During the Depression, stocks seemed to swing from massive losses to massive gains on a calendar basis. I believe 2010 will be on the left tail.

  2. Steve Barry says:

    The top chart is mixing apples and oranges a bit…the decade bars I assume run from 1930-1939, 1940-1949 for example…the best and worst are for every rolling 10 years? A chart of top 10 and bottom 10 rolling 10 year periods might be a good companion. I don’t know anyone who invests based on formal decades.

  3. Greg0658 says:

    I think an excellent reflection chart would include:
    White Collar (Corp Top Exec) – extraction from profits
    Blue Collar (laborers) – extraction from profits
    Shareholders (investors) – extraction from profits

    and I guess the flipside this day & age would include:
    Taxpayers input to profits

  4. Greg0658 says:

    ps – Blue Collar (laborers) by Nation & State

  5. seneca says:

    Adjusted for inflation, the 1970s would look far worse, probably on a par with the 1930s.

  6. JustinTheSkeptic says:

    I have not seen any news of financial book keeping fraud in a while. Does anyone have the numbers on year over year comparisons on such stuff? Could it be since the authorities have left the Banks of the hook that other accounting departments in the corporate world are cheating too? There just seems to be a lack of fraud these days. If there were ever a time to cheat it would have been this past year.

  7. says:


  8. seneca says:

    My prediction for 2010: Yahoo Mail’s spellchecker will finally recognize “Obama,” and not helpfully suggest changing it to “Bomb,” “Boom,” or “Burma.”

  9. Greg0658 says:

    pss – extractions for real items – not #s in accounts .. with a promise of future extraction

  10. MorticiaA says:

    LOVE the PPCA website, btw.

  11. Mannwich says:

    @Justin: That’s been my theory for a while now too. If the financials are allowed to basically “extend & pretend” (read: lie) about their financial condition, then why not other companies from the non-financial industry? Would this shock anyone?

  12. Muir says:

    Just sayin thx and prosperous Year.
    Really like The Big Picture

  13. Uchicagoman says:

    What was that about EMH? ;-)

    The second chart looks nearly like a Normal Distribution to me… mean ~ 10%,

    Although quite a large SD though, plenty of room for nimble investors to take advantage, and for silly speculators to get burnt.

    Notice how 1-3 year intervals are nearly split return wise between -/+ ends.

  14. You can put just about anything into a bell curve distribution !

  15. JustinTheSkeptic says:


    And whatever happen to the section in Sarbanes/Oxley where Investment Advisors have to disclose what the own? . You hardly ever hear them mention anything on the boob-tub???

  16. Mannwich says:

    @Justin: Me-thinks that public companies now have the ultimate window of time where they are almost EXPECTED to fudge the numbers. I’ve thrown this out there before in the past several times and nobody has offered up a counterpoint to disprove why what I’ve asserted cannot be going on. If you’re a public company on life support (and hence with said executives having A LOT riding on its survival……meaning no job or income if said company goes down), wouldn’t NOW be the perfect time to simply lie for as long as possible and hope the authorities look the other way in the name of “spurring the economy”? Anyone? Bueller? Bueller?

  17. Mannwich says:

    When the wrong incentives are in place, you will get the wrong behavior every time en masse. Plain and simple. And right now, there are PLENTY of incentives to cheat. Look around. There’s shenanigans going on everywhere with no consequences. Why be surprised to see more of it and not less?

  18. DiggidyDan says:

    What a horrible chart. The top one. The distribution is ok. The other is a travesty to any ideals of rational numbercrunching.

  19. [...] couple of charts help put stock market performance in [...]