Wednesday, February 02, 2005

Investing in the Stock Market with Bush

DJIA as of December 2000 11,497
DJIA as of December 2004 10,583

So if you had your retirement in an index fund pegged to the Dow Jones you would have lost 10% of your income since GW took office.

Lets try and broader index say the SP500

SP500 as of December 2000 1,517
sp500 as of December 2004 1,150

You would have lost 25% of your investment if your fund was indexed to the sp500

How about the fancy NSDAQ

NASDAQ as of December 2000 4,697
NASDAQ as of December 2004 2,000

Ouch! Your fund would have been down a whopping 58%

Lets invest in the Russel 2000 in December of 2000

Yippee! We would have made 5.7% on our doe! With inflation running at around 4% that is a whopping gigantic net gain of 1.7% over the last 4 years.

Finally we will use the very broad Russel 3000 Index. This fund comprises the movements of 3000 stocks, both large and small cap.

We would have made .92%. That is less than 1% over the last five years. We should have stuck it in the bank.

So GW and the turds that want to sell the snake oil of private accounts better add the following to any stupid proposal they are shoving at the gulable American middle. "Only invest what you can afford to lose." That is the standard advice ANY planner will tell you about dealing with stocks and bonds. There are NO gaurentees in the market. NONE.

How many social security checks shrunk when the WTC was attacked? NONE.

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