
chart A

CHART B

S&P 500 PE S&P 500 Price S&P 500 Earnings S&P 500 Dividend Yield Interest Rate Inflation more ▼ multpl
Case Shiller National Home Price Index
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Current Index: 131.81
January 2010
The Case Shiller Home Price Index is an indicator of U.S. housing prices nationally.
The data presented is in nominal (non-inflation-adjusted) dollars. For an inflation-adjusted (and more striking) view see Case Shiller Home Price Index, Inflation Adjusted
The steep decline in US home prices, starting near the end of 2007, is the largest drop since the great depression and the 1930s.
Data is courtesy Robert Shiller, from his book, Irrational Exuberance, and Standard and Poor's, which provides more information on the methodology for calculating the Case Shiller Home Price Idices.
Information is provided 'as is' and solely for informational purposes, not for trading purposes or advice, and may be delayed.
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NOW COMPARE TO THE STOCK MARKET IN NOMINAL TERMS---chart A
we shall track from 1900s- great depression to now to see a similarity in us markets and now
time period 1:1900 to 1930:
us dow jones OUTPERFORM US PROPERTY MARKET 60 TO 300 IN DOW JONES VERSUS A 3 TO 6 PT RISE IN CASE SHILLER
TIME PERIOD 2: 1930 TO 1940
STOCK MARKET RECOVER TO 200 FROM DOWN FROM 300 TO 40.PROPERTY MARKET RECOVER MUCH LESSER THAN DOW---FROM 7 TO 4 THEN TO 5
THIS CLEARLY SHOWS EVEN IN A STOCK MARKET CRISIS 1930, THE STOCK MARKET OUTPERFORM THE PROPERTY MARKET
time period 3:1940-1950
CASE SHILLER rocket from 5 to 11, BUT DOW is flat for a decade!!!!
TIME PERIOD 4:1950-1970
CASE SHILLER IS FLAT BUT DOW UP FROM 300 TO 1000!!!
time period 5:1970-1980
DOW FLAT AT 1000!!!! BUT CASE SHILLER CHEONG 2X!!!
TIME PERIOD 6:1980-2000
GOLDEN PERIOD FOR US!!!
dow up 10 TIMES from 1k to 10k
BUT CASESHILLER UP ONLY 2X!!
TIME PERIOD7:YEAR 2000 TO 2010:
DOW STUCK AT 10K FOR A DECADE!!
BUT HOUSES ARE STILL HIGHER THAN 2000!!
WHAT ARE LESSONS LEARNT?
1.PROPERTY AND STOCK MARKET TAKE TURNS TO CHEONG UP but STOCKMARKET OUTPERFORM PROPERTY IN LONG RUN DUE TO FASTER AND BIGGER RISES CONSISTENTLY OVER A CENTURY!!
2. HANGSENG BEHAVES LIKE DOW JONES STUCK AT 20k FROM 2000 TO 2010 but snp500 is below 2000 highs of 1560 showing weakness in us general economy.dowjones having more overseas business companies eg caterpillar is at the 2k year highs
hence i conclude that hangseng will trade like the dow going back to 32K AND BREAKING IT in the next few years prob 2012 as hangseng hasnt moved much for past 10 years
hsi chart for past 20 years:
http://uk.finance.yahoo.com/echarts?s=%5EHSI#chart1:symbol=^hsi;range=my;charttype=candlestick;crosshair=on;ohlcvalues=0;logscale=off;source=undefined
hongkong property prices also at year 1997 levels BUT the difference is that hsi is above year 1997levels but hk property price at 1997highs EVEN AS INTEREST RATES KEEP ON GOING DOWN.SHOWING BUYERS FATIGUE IN PROPERTY.SUPER LOW INTEREST RATES CANT PUSH PROPERTY TO SUPER HIGHS--CHART C
from the dow jones chart,1930s was stckmkt caused ,2007 was housing caused,u superimpose 1930s stckmkt chart to be housing 2010 chart and we know us housing going to be stuck for a long time prob 20 years in the mud, whereas the dow jones with the hangseng in 2012? will break to new highs(due to MNCs,companies deriving their revenues from overseas like china,asia.)as shown by the case shiller in the 1940s
property is like an inferior good,rising much lesser and slower than the stock market overall.
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