Inflation Adjusted: Bull or Bear?

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For some long-term stock market perspective, today’s chart illustrates the inflation-adjusted S&P 500 since 1900. It is of interest that, when adjusted for inflation, massive bear markets similar in magnitude to what occurred in the early stages of the Great Depression (i.e. early 1930s) are actually not all that uncommon. For example, the secular bear markets that concluded in the early 1920s and early 1980s were of similar magnitude. It is also of interest that the inflation-adjusted S&P 500 is up 550% since 1900. This equates to an average annual return of 1.7%. Currently, with the S&P 500 trading 41% off its inflation-adjusted year 2000 peak, the S&P 500 trades very much near the center of its century-plus upward sloping trend channel.

– The market is at a critical juncture. Where we go from here may surprise you. Find out right now with the exclusive charts of Chart of the Day Plus.

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