Silver vs CPI vs Stock Market

Discussion in 'Bullion Investing' started by Phil Ham, Feb 22, 2015.

?

Where are you investing most of your money?

  1. Bullion

    6 vote(s)
    17.6%
  2. US Equity Market

    23 vote(s)
    67.6%
  3. Global Equity Market

    3 vote(s)
    8.8%
  4. Real Estate

    0 vote(s)
    0.0%
  5. Bond Market

    0 vote(s)
    0.0%
  6. Money Market

    0 vote(s)
    0.0%
  7. Under Pillow

    1 vote(s)
    2.9%
  8. None of the Above

    1 vote(s)
    2.9%
  1. Phil Ham

    Phil Ham Hamster

    I thought that I would compare the performance of silver versus inflation (CPI) versus the stock market (S&P 500, Dow Jones, and Nasdaq). It shows the percent difference in value from 1980 to today. I doubt that you'll see this chart on a bullion website.

    upload_2015-2-22_12-24-38.png
     
    Paul M., xCoin-Hoarder'92x and medjoy like this.
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  3. ROLLJUNKIE

    ROLLJUNKIE Active Member

    Talk about raining on everyone's parade... :)
     
    xCoin-Hoarder'92x likes this.
  4. -jeffB

    -jeffB Greshams LEO Supporter

    I usually weigh in on these threads on the same side that @Phil Ham illustrates here, but I'm compelled to point out that this chart starts near silver's all-time historic high. Sure, a very unlucky speculator would see returns this poor, but this chart is no less misleading than the silver-bug charts that start at 1999.

    Edit: BTW, I'm a bit confused that the chart shows the NASDAQ higher now than it was pre-2000. We still haven't reclaimed the NASDAQ's all-time high. Or are these monthly or yearly averages, or snapshots that missed the high point?
     
    medoraman likes this.
  5. rickmp

    rickmp Frequently flatulent.

    All of my spare cash gets invested in good bourbon. No return on the investment, but I sure do feel good.
     
  6. Phil Ham

    Phil Ham Hamster

    Thanks Jeff. You are right of course, it always depends on the window. Here's the look from 1990-2014. US Equities will win but by less.

    upload_2015-2-22_13-32-55.png

    Here's the look from 2000-2014. Silver is king!

    upload_2015-2-22_13-33-49.png

    Here's the look from 2010-2014. Not so good for silver.

    upload_2015-2-22_13-34-33.png
     
  7. -jeffB

    -jeffB Greshams LEO Supporter

    Very nice assortment. Of course, you left off the one that starts at 2002 and runs to 2012 -- with the "OMG silver going parabolic!!!!" dotted-line extrapolation into the future. Saw an awful lot of that one a few years ago. :)
     
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  8. medoraman

    medoraman Supporter! Supporter

    Yeah, I still have the welts on my back from the bullion section whipping me when I dared contradict them. :(
     
    Dave M likes this.
  9. onecenter

    onecenter Member

    I have stuck to global equities for 25 years and for 25 years, I have been very successful, health care being incredibly profitable. I have not changed my strategy. I buy silver for collecting enjoyment not for investment.
     
  10. beef1020

    beef1020 Junior Member

    Chart probably includes dividends in the percent return, hence the higher level for the NASDAQ.
     
  11. GoldFinger1969

    GoldFinger1969 Well-Known Member

    Where you start -- and end -- is critical.

    However, Modern Portfolio Theory (MPT) would state that rolling periods are the best measure. On that score, commoditites do terribly compared to equities and even bonds. There are too many years/decades where PMs are flat or down, even when prices were no longer fixed.

    NASDAQ pays miniscule dividends, Beef.

    For the S&P 500 or DJIA, dividends are 40% of the total return over time. Probably 10% for the NAZ.
     
  12. Phil Ham

    Phil Ham Hamster

    The CPI value is the average for each year. The others investments charts report values at or very near the end of each year. The dividends aren't reported in the equities and would only make those investments better (minus the fees). I wanted to include the foreign markets (e.g. FTSE, DAX, NIFTY....) but it got complicated with the currency conversion to $USD. When I gain motivation, I may add more charts.
     
  13. JPeace$

    JPeace$ Coinaholic

    US Equities is an investment. If your good at this hobby, it's capital preservation (assuming your not a dealer).
     
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  14. medoraman

    medoraman Supporter! Supporter

    It can be capital preservation. I simply hate thinking about it in th ose terms though. I prefer to love my coins, treat them as spent money, and let my heirs benefit if they have caught the coin bug and wish to cash them in. This way I am not tempted to spend investment money on my hobby, and I don't have to stress if my coins will go up in value.

    Have fun with your coins.
     
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  15. Phil Ham

    Phil Ham Hamster

    Silver continued its losing ways in 2015 (down 14.4%). Nasdaq had the best performance in 2015 (up 8%) with S&P 500 down 0.7% and Dow down 2.2%. The CPI was virtually flat in 2015; up 0.25%. Silver continues to be the best investment since 2000 but a very bad investment since 2012. For the long term investors, the Nasdaq would provide you the most wealth since 1980 or 1990. For those following silver, it is now at a value close to 2006. If you take into account inflation, it is more like 2005. For the optimists, the potential for a rebound to 2012 is in store for you when it was $31.81/ounce. For the pessimists, it could fall to its value like it was in 2000 when it was $4.74/ounce (inflation adjusted to $6.35/ounce). I'm a little pessimistic at the moment and expect that it will fall further before a rebound. Thus, my silver holdings have moved to a longer term investment. Here are some charts for your enjoyment.

    upload_2016-1-1_9-42-39.png

    upload_2016-1-1_9-43-8.png

    upload_2016-1-1_9-43-39.png

    upload_2016-1-1_9-44-8.png
     
  16. Phil Ham

    Phil Ham Hamster

    Here is my annual update on silver prices vs the stock market vs inflation over the past 36 years. Inflation continued to be relatively modest at about 2% in 2016. Silver had a good year, increasing in value by 15.0%. The Dow Jones was second at 13.4% with the S&P 500 next at 9.5% and the Nasdaq next at 7.5%. I'm still investing heavily in the stock market but have used my Roth IRA to purchase silver over the past couple of years. I've been closely tracking my ROI since 1993, which currently sits at 7.45%. It has been substantially helped by heavy investing in the stock market in 2008-2011. I'm now slowing moving to Euro-Pacific stocks and silver. The roller coaster should be fun to watch over the next four years.

    upload_2016-12-31_10-14-36.png
     
    onecenter likes this.
  17. Phil Ham

    Phil Ham Hamster

    Here are some charts to show performance over different time periods.

    upload_2016-12-31_10-17-53.png

    upload_2016-12-31_10-19-28.png
    upload_2016-12-31_10-18-49.png
    upload_2016-12-31_10-19-54.png
     

    Attached Files:

    medoraman likes this.
  18. Phil Ham

    Phil Ham Hamster

    Here is my annual update on silver prices vs the stock market vs inflation over the past 37 years. Inflation continued to be relatively modest at about 2.2% in 2017. Silver had a pretty good year, increasing in value by 6.3%. The stock market had excellent years with the Nasdaq at 28.2%, Dow Jones at 25.1%, and the S&P 500 at 19.4%. I'm still invested in the stock market but continue to purchase silver as a hedge. Unless you were exclusively invested in bonds, you probably made out well in 2017.

    upload_2017-12-30_16-35-57.png

    upload_2017-12-30_16-26-23.png

    upload_2017-12-30_16-28-19.png

    upload_2017-12-30_16-32-1.png

    upload_2017-12-30_16-32-53.png
     
  19. Bman33

    Bman33 Well-Known Member

    I doubled how much money I put into my 401K this year. With my match I had a 21% growth. It was a good year. Some say to go conservative again because of an inevitable bubble burst. I'm not quite sure what to do. Don't have a crystal ball and I'm not good at timing the market. I did increase my Ag and Au holdings too. Got a little heavy on silver so I will refrain from buying it for awhile and get some gold here and there.
     
  20. Phil Ham

    Phil Ham Hamster

    I give a lot of my friends and family advice on this topic. It all depends on your time horizon. If you'll need the money in 1-3 years, put the money into a safer investment. If the need is 3-5 years away, go a little more risky. If it is longer than 5 years, go aggressive. I'm retiring in the next couple of years and moved some investments that I will need in the first 2 years on retirement into a safer place. As I plan to life for 30 more years, much of the rest will remain aggressive. As a note, I'm not a financial advisor but consider myself quite good with money, math, and statistics. Take my advise at your own risk.
     
    Don P likes this.
  21. Bman33

    Bman33 Well-Known Member

    A guy told me to subtract my age from 100 and that is the percent I should have in equities vs bonds. That means I should have 58% in equities and 42% in bonds. I'm not abiding by that at all as I have gone aggressive with the exception of PM's.
     
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