Lost Decades

By Fester:
The lost decade is ongoing:

Econbrowser on employment:

BLS reported that the total number of Americans employed in June on nonfarm payrolls came to 131.7 million workers on a seasonally adjusted basis. That's below the June 2000 figure of 131.8 million with which we started the decade.

And the Big Picture on investment returns:

Imagine two people who added $10,000 to their investment accounts on January 1st, every year for the past 15 years.

One of them is risk averse. They put the money into Certificates of Deposits, getting a few percentage points each year, but the principal is insured.

The other is less risk averse; they put money into an S&P500 Index each year....

As of March, Bonds had outperformed Stocks from 1968 to 2009 — 40 years

And the stock market was where we were supposed to trust our retirement, our college education and hell even our medical care with those great nifty flexible spending accounts and health spending accounts which would grow for as far as the eye could see to cover the ‘rationally’ borne risk. What a deal, what a scam. Unless you can either consistently top tick or exploit insider information, long term investing has not been a good strategy since before I was born.

Comments

[RAM]

I can't get either link to work.

[Russ Wellen]

In the 60s, when my father's income began to rise, he started dabbling in stocks. That's what the stock market is for -- if you have some extra money, play around with it.

What a coup it was getting Americans to base their retirements on the performance of equities. Just to help keep employers from the cost of paying into "defined benefit" (pension) plans.

Unfortunately my father invested more and more aggressively. In the 90s many brokers kept their clients in stocks, instead of switching them to fixed income, the usual practice with aging investors. My father went along with that and there went a large part of his and my mother's retirement.

[hidflect]

The first link, you have to erase the " mark at the end of the URL. The second one is just plain bust.

The Far-Reich saw investment of 401K into stocks as a "synergy" move. Every time you hear that word run screaming. The idea was that employees would have a more vested interest in seeing the companies they worked for do well. Of course that's total pigsh1t. People who depend on their 401K's are generally already very diligent and already do lots of free overtime, etc. for their company. It's the psychopath at the top creaming off a few hundred million who hired the lobbyists and bribed the media and gummint to play along with the idea.