Treasury Yields at New Lows

[benhacker]

I heard on a recent Consuela Mack episode that the 90-day Treasury Bill has outperformed the S&P 500 every quarter since 1997.

 

hahah... I don't think so JEast... think about the implications of that. :)

 

Ben

[JEast]

think about the implications

 

Always Invert.

I have attempted to disprove it, but haven't yet.

However and roughly, in the year 2000, the discount rate was 5%.

For the next 10 years the S&P was down negative 0.95% p/year.

Over that same 10 year span, the 90-Day T-Bill, if rolled over, is up significantly.

This does not prove the comment, but it does not seem that wild in comparative context.

 

Cheers

JEast

[turar]

Even so, it is my firm belief that the majority of gov't capital allocation is poor and in fact detrimental to society. "Starve the beast" continues to be my motto.

 

This reminded me of a post I've read recently. No offense and no intention to get political, just an interesting association. I think quoting in full here wouldn't be too harmful:

 

    This morning I was awakened by an alarm clock powered by electricity generated by a public power monopoly regulated by the Department of Energy.

                                                                               

      I then took a shower in clean water provided and its quality monitored by the municipal water utility. After that, I turned on the TV to one of the FCC-regulated channels to see the National Weather Service of the National Oceanographic and Atmospheric Administration weather forecast, using satellites designed, built, and launched by the National Aeronautics and Space Administration. I watched while eating my breakfast of Department of Agriculture-inspected food which has been determined safe by the Food and Drug Administration.

                                                               

    At the appropriate time, as kept accurate by the National Institute of Standards and Technology and the US Naval Observatory, I got into my National Highway Traffic Safety Administration-approved car and drove to work on roads built and maintained by the local, state, and federal Departments of Transportation. On the way, I bought fuel, of a quality and quantity determined by the Environmental Protection Agency and the state Department of Weights and Measures, using legal tender issued by the US Treasury Department.

                                                               

    On the way to work I deposited my outgoing mail via the US Postal Service, and then dropped the kids off at their public school.

On my lunch hour, I helped Dad register for his Social Security Administration old age pension and my parents’ Medicare health care benefits, to help them survive in their old age.

                                                               

    After spending another day not being maimed or killed at work, because of regulations imposed by the Department of Labor and the Occupational Safety and Health Administration, I drove back to my house. It had not burned down in my absence, because of the state and local building codes and the County Fire Marshal’s inspection, and had not been plundered of all its valuables, thanks to the municipal police department.

                                                               

    I then logged onto the Internet, which was developed by the Defense Advanced Research Projects Administration, and I posted an angry letter on Fox News forums stating that any government option in the proposed new health care legislation will be BAD because the government can’t do anything right.

                                                               

  I am a proud blue-collar Republican who won’t tolerate any government role in my life.

 

 

http://normh.us/?p=59

[Myth465]

http://normh.us/?p=59

 

Lol

[benhacker]

JEast,

 

Clearly your wrote something you didn't intend.  Reread your quote again:

 

I heard on a recent Consuela Mack episode that the 90-day Treasury Bill has outperformed the S&P 500 every quarter since 1997.

 

Since 97, the 90 TBill has outperformed the S&P... yes.   But it has not done so each and every quarter of that time period.  That, should be obvious to everyone.

 

There are several quarters in the middle that were >10% returns for the S&P, which obviously, the T-Bill could not have beaten.

 

Just wanted to clarify.

 

Ben

 

 

[JEast]

I went back and reviewed the statement again.  The quote was, 'Bianco Research indicated that the S&P 500 has not outperformed the 3-month treasure bill since May 1997'.  No indication if this was a quarterly, or a yearly observation.  Still quite illuminating though.

 

http://www.arborresearch.com/main/index.php?

http://www.wealthtrack.com/video_player-01.html  (Around the 2 minute point.)

 

 

Cheers

James

[benhacker]

Ok, that makes sense. Yeah, stocks haven't gone anywhere for 12 years.  Well, on aggregate, big cap mostly, stocks haven't.  I still think it wasn't a bad 10 years to be a stock picker. 

 

Ben

[Myth465]

Ken Rogoff on Charlie Rose

 

http://www.charlierose.com/view/interview/11154

[biaggio]

Ok, that makes sense. Yeah, stocks haven't gone anywhere for 12 years.  Well, on aggregate, big cap mostly, stocks haven't.  I still think it wasn't a bad 10 years to be a stock picker. 

 

Ben

 

Stocks have been somewhere in last 12 years, unfortunately there were a lot of round trips. If you bought at a discount + sold at fair or over value you did fine i.e. being a stock picker as you said.