Tuesday, November 25, 2008

Real returns to S&P 500


I was surprised about two things from this graph that was posted on Worthwhile Canadian Initiative.
1. Real returns between 1960 and 1990 were so low ~ 1 percent.
2. Real returns doubled only only recently.
Stephen Gordon was wondering if his paper which used pre-1993 data could be extended to include the latest data and concluded not. The obvious question is: What caused the increase in real return? Fundamentals or bubble?
P.S. Why is it so hard to get publicly (i.e. free) data on total return of the paper S&P 500? Neither S&P nor Bloomberg have these as downloads.

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