Believing that the market is currently trading at prices that are too high and attempting to predict "If & When" a correction will occur, are two different things.
As long as folks are satisfied with, and believe they are making, about 6% (2% dividend yield + 1.5% real growth + 2.5% inflationary growth) on their investment in the S&P 500, no correction is required.
The day they decide they want 7% the dividend yield would have to rise to 3%, which would require that the price fall 33%.
If at that point, the real growth has also declined from 1.5% to 1%, then the dividend yield would have to rise to 3.5%, which would require that the price fall 43%.
If you go to the multpl site and click on Dividend Yield under S&P 500 Stats, you'll see that, almost without exception, the dividend yield has been 3% or higher in the past. The major exception is, of course, the period from 1993 to today when stupid boomers like me started throwing money at the markets to fund their retirements.
The major exception is, of course, the period from 1993 to today when stupid boomers like me started throwing money at the markets to fund their retirements.
dont be too hard on yourself bro, its a dirty rotten businees designed to rip off retail so that the rich can get much richer. Bogel is one of the very few who spoke up over the years , most others are just in on the con. too bad buffett never really spoke up, even worse he invested and backed many of the co- CONspiritors.
shameful, who knows how much he really understands about the game and how ts played ? fb,znga,grpn, mrin, yep.