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To: playavermont who wrote (19763)	6/13/2002 4:11:08 PM
From: lisalisalisa	Respond to of 74559

<<<<<<<2 very simple questions:>>>>>>>> 1. whats your point? that we are gonna come out this recession like last one? 2. dont know- 500%?

To: playavermont who wrote (19763)	6/13/2002 9:03:02 PM
From: TobagoJack	Respond to of 74559

Hi playavermont, <<What is a reasonable rate of return PER YEAR investing in the stock market based on history?>> Should 10-30 year interest rate be absolutely guaranteed to remain at about 5.x % real rate, then shares should average 6.x-7.x%, because companies will borrow instead of issue shares until the difference in bond/equity rates converge. The world offers no guarantees of such nature, and therefore the question is not simple, especially when we are starting at such a high valuation base. My guess, a simple one, is that we will have negative real returns for a while longer, until people stop asking simple questions. To put it simply, we are going down the gurgler, turning, gyrating, waving, struggling for air ... Message 14861804 <<Just for example, if we were to use NASDAQ index in 1989 at 500 (plus or minus a few points) as starting point, and apply a long term rate of return of say, 15%, then a nasty correction can take the NASDAQ to 2300. If we use 10% as the long term return rate, then the correction of NASDAQ can take us to 1400. We know by experience of others that the markets always reach for extremes, in due time. Should any of the above two cases materialize, all financial institutions the world over will suffer, the faith in all currencies will drop, regardless of national pedigree, more so for previously highly valued ones. Problem is that the currencies can not all depreciate against each other, but must depreciate against a standard.>> Chugs, Jay