>Doug, your latest LBO has avg. stock returns, adjusted for inflation,
>returning about 6% over the last, what, 80 years? What would the
>above figure be, similarly adjusted?
These things are pretty sensitive to the time period covered. Real total return on stocks - dividends plus capital gains, all reinvested, no taxes or transaction fees - averaged 6.8% a year from 1871-1998. Average return since 1982 has been more than twice that, 14.7%.
For bonds, counting both price and interest, the average over the 1857-1998 period was 3.7%; since 1982, 9.6%. The bond average is greatly depressed by the 1950-81 bear market, the worst in the history; average real annual returns for 1950-81 was -4.2%.
I've got charts in the back of Wall Street that show these bond and stock returns by decade.
Doug