This chart shows the inflation adjusted performance of the S&P 500 over the three major secular market cycles of the last 100 years. Each graph line begins and ends at the lowest point of the cycle and is adjusted for inflation using the headline CPI.
Neat
>>1236238
In ways they're similar. Also, it would seem we're due for a crash.
>>1236252
Only thing that gets me nervous is the 3 peaks of the last cycle. In reality though no one knows where this is going. The money supply and investment in financial assets has gone through the roof due to QE and there's nowhere else to put your money. Unique time in history to be investing.
Keep those hedges up. Im keeping porttfolio beta 0.5 or less.
>>1236266
You're too educated for this medium. Is this the only home you have?
>econometrics
>science
>>1236280
>Has no idea what econometrics is
>>1236238
Care to explain how you derived 3 different charts for the S&P500??
>>1236311
Check the legend.
>>1236272
I just come here when I'm browsing the 5-6 boards I go on 4chan because it's my career and academic interest.
I know nothing of value is posted here it's like 75% shills baiting people into some variant of a pump n dump scheme or people with no idea what they are talking about giving """"""""stock advice"""""""""
>>1236313
ok so you're assuming each "cycle" lasts 33 years. Any particular reason why you chose 33?
>inb4 freemasonry
>>1236311
Should have posted source in OP but here's the sources if you would like to play around with the data:
Data Sources: Yahoo Finance, Robert Shiller, BLS
This is a graph by Robert Shiller, who is a very well known economist.
>>1236316
27, 33, TBD. A single cycle is going from start around back to start, or from low around back to low, with a high in between.
Not the OP.
>>1236238
neat. those certainly are graphs.
Questions: how might you ascertain 1.) which pattern we're following now and 2.) where we are on that cycle today?
>>1236325
Whatever his responses might be, they will be based on arbitrary inferences and data dredging. He just pulled out a few "cycles" out of his ass and played around with the data until he got vaguely similar price curves
Just a friendly reminder that econometrics is not a science because
1) The theory describing the behavior of the underlying ends up influencing the underlying itself
2) Past performaces do not guarantee future performances
3) Price distribution exhibits fat tails
4) Modern econometrics is no different than voodoo: you start with a few wrong hypothesis hoping people will be dumb enough not to notice, proceed with silencing the dissenters, and then you build up a complex system with a few differential equations, overfit data and stuff like that. Enough people listen to you and start behaving in a certain way, this "certain way" influences the underlying until it becomes predictable. You then proceed to gloat and sit on laurels.
Eventually your flawed hypothesis catches up with your model, your model fucks up, you find someone to blame, another one builds another model and so on ad nauseam. Or until the taxpayers run out of the bailout money.
The right questions would be
1) Why are these academics not actively trading?
2) Why is the failure rate so high for hedge funds employing quantitative methods?
3) Why are people so easily impressed by degrees, authority figures and why do they see patterns among randomness?
>>1236360
I hear you. maybe someday pic related
>>1236360
Perhaps the OP's graph may be pulled out of his ass. But the fact of the matter is, there is no new volume confirmation to sustain a continuous uptrend. The only way is DOWN. If you're not placing long term shorts you are literally missing out on the Big Short 2.0
>>1236238
they're not fucking similar at all
>>1236399
> But the fact of the matter is, there is no new volume confirmation to sustain a continuous uptrend
Or maybe the market will just consolidate up and down around the recent range until it gathers enough strength to push higher. Or maybe it will crash in a year or two. Or the consolidation is over and a new slow uptrend will start.
The message i'm trying to bring here, nobody fucking knows where the market is going, no matter how many equations you bring in, and how many years you put in studying voodoo magic cloaked as science.
Econometrics is not a science and never will be. The theories influence the underlying. Physics have theories regarding gravity, but gravity is never influenced by those theories. Physics is science. Your educated guesses will be always barely worth more than a coin toss
The only sensible way to make money is betting on the only two things certain in the markets that is, prices move and when they do, they keep going in that direction. Occasionally you have cataclismic moves: mainstream econometrics models get discarded and the people creating them are painted as the Antichrist, and obscure models that have "predicted" the chaos become mainstream. Another cycle begins
So, in a nutshell
>keep your bet smalls
>manage your risk
>limit the left side of the tail
>maximize the right side of the tail
>turn off the TV and put plugs in your ears next time you hear the "experts talking" and close your eyes when they start showing you graphs to convince you to buy or sell stuff
>>1236449
Bumpin
>>1236449
what the fuck do you think you're doing? don't you know that making sense isn't allowed here?
>>1236238
>trying to predict the future direction of the markets from charts
Just stop. It doesn't work, it has never worked, and it will never work.
Oh, and it doesn't matter if God himself made the charts; you're still incapable of deriving any forward looking data from them.
Moron.
>>1237238
>Kek this graph is made by a top 5 economist globally.
Not an argument
>>1237480
>>1237479
This graph isn't implying anything. It's an interesting chart. There is no forecast of what the market is going to do here. It's displaying what the market has done over equivalent intervals over the last hundred years.
Btw 3*33=100 for the kids that don't understand the description.
>>1236315
Welcome to 4chan
>>1237689
You're clearly trying to imply something, or else you wouldn't have told us three times that the chart was made by Shiller. An "appeal to authority" is a type of argument, in addition being a classic logical fallacy.
Also, by suggesting that the chart is "interesting" implies that there is something of interest that can be read in the chart. Although patently false, you're still making the implication. Whether that implication was intended to be forward-looking (as I assumed) or historical is less clear because you're being obtuse in order to avoid direct rebuttal.
I suspect you're seeing patterns where none exist. It's a common flaw of the human brain (known as "apophenia") and it actually pops here on /biz/ quite often. You should make a concerted effort to stop, assuming you care about becoming a more intelligent investor.
