Historical Stock Charts, What Can We Learn?

While browsing ‘The Big Picture’ for 100 year stock charts, I found several historical stock charts that got me to thinking about the current situation of the market.

The images below shows the performance of the U.S market over the last one and two hundred years:

I like to immediately focus in on the stock market crashes. Most of which seem to recover quite quickly, as demonstrated by the crashes of 1987 (23% drop, recovered in nine months), 1998 (36 drop, recovered in three months) and 2002 (37% drop, recovered in two months). However, what about periods of low/no growth such as those seen between 1966 to 1982?

It is said by Jim Rogers, Dan Denning and many others that we are in for a period of low growth, with commodities set to out perform. Looking at the above diagram, I can’t help but agree with their predictions (from a chartist point of view).

I thought that it would be interesting to focus in on a period of no growth as the chart below illustrates:

It is worthwhile looking at this time period and considering what investment methods outperformed and should they be considered in today’s climate? Are commodities the answer?

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Tags: commodities, historical_stock_charts, jim_rogers, stock_market_crashes

21st Jan 2006 Investors Insight Trackback

3 Comments

1. Investablog
22nd January 2006, 10:33 pm

Historical Stock Charts, What Can We Learn?…

The Jargon Free Investment Blog takes a look at what we should be learning from Historical Stock Charts. While browsing �The Big Picture� for 100 year stock charts, I found several historical stock charts that got me to thinking……
2. Ian
17th September 2006, 9:37 am

We I tend to agree that commodities are definitely offering more at the moment. I’ve started buying Tax free Hong Kong Gold through a company called dalbec gold…. http://www.dalbecgold.com my advice to anybody is to check out their site. In hong kong the buying and selling of spot gold doesn’t incurr tax even when realised with a profit. Food for thought I suppose. I find the equities market a warren of boardroom decisions and politics. At least gold is honest and on the way up.
3. James Galvin
16th February 2007, 7:02 pm

If the last century belonged to America and the new one belongs to East Asia (china in particular) I wonder about the predictive value of looking at the U.S. market over the time of its heyday. As we sell off our assets, and slowly devalue our currency I dont think that the next 100 years will be as bullish as the last 100 years.

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