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Strategies & Market Trends : Mish's Global Economic Trend Analysis -- Ignore unavailable to you. Want to Upgrade?

To: Tommaso who wrote (8764)	7/7/2004 1:06:09 AM
From: 8bits	Respond to of 116555

"Are you talking about the dollar price of oil or the inflation-adjusted price? I just found a table that shows oil selling for over $34 in Louisiana in 1981-82, which I guess is in the range of where we are now--and as you say, the finanacial market averages were 10% or less of what they are now." Nominal price, if the price of a barrel of oil were adjusted to Today's inflation it would be around $80. My idea was to see how much US equities (or bonds for that matter) the Saudi's could have bought in the late late 70s to early 80s when oil was high and the market was much lower (Say 1978-1983). As you say equities were selling for 1/10 then I think they could hold 1 trillion in equities (if they bought the indexes. etc..) and held. This would also be discounting any purchases before 1978 and after 1983 and not include reinvested dividends. I doubt that's the investing pattern they took but during that time they were very flush with cash during that timeframe and they've have had a few good years after 1983.