Friday, January 10, 2014

Real Nonfinancial Corporate Business Equity per Capita

Click to enlarge.

The $60,000 is patiently waiting there for you to retire again (as of September of 2013). I'm glad we finally got that all worked out. Other than returning to the $21,600 median again someday, what's the worst that could possibly happen?

I mean seriously. As long as nobody panics and attempts to cash out that $60,000 per capita to fuel a retirement, then stocks have probably reached a permanently high plateau. Oh yeah, that's a plateau all right. Don't let the nattering nabobs of negativism convince you that it is the third spike higher of three (since the late 1990s). That's just crazy talk.

What are the odds that those with the most stock market exposure (soon to be retirees) will be the ones to cash some of those stocks out? Makes no sense at all unless retirees, for some unknown and irrational reason, suddenly decide to embrace less risk once they quit their jobs (as I have done). And why would they buy low and sell high when everyone knows for a fact that stocks only go up again? Do they just want to lose money make less money?

Irving Fisher

Fisher was perhaps the first celebrity economist, but his reputation during his lifetime was irreparably harmed by his public statements, just prior to the Wall Street Crash of 1929, claiming that the stock market had reached "a permanently high plateau."

This is not investment advice. I don't claim to know the future with any level of certainty, which is a far cry from what we're continually told by the guests on CNBC. Expert after expert tells us that stocks are the only place to be and that long-term interest rates can only go up from here. Maybe. Maybe not. In any event, call me extremely skeptical.

Source Data:
St. Louis Fed: Custom Chart


Troy said...

graph-as-wisdom dep't:

Stagflationary Mark said...


That one should scare the heck out of most people.

That said, most people don't believe they are most people. This is America. The average person is better than average here!

For driving skill, 93% of the US sample and 69% of the Swedish sample put themselves in the top 50% (above the median). For safety, 88% of the US group and 77% of the Swedish sample put themselves in the top 50%.

Stagflationary Mark said...

Surely if 93% of us can drive better than the median driver, then 93% of us can day trade better than the median day trader!

Heck, they've already got me beat. I refuse to play. The thought of going head to head with professional traders armed with supercomputers and advanced proprietary trading algorithms doesn't appeal to me all that much.

Troy said...

RE my above . . .

scary thing is I knew where the green would cross before I graphed it.