>Doug Henwood wrote:
>
>>Ok, the promised chart, showing how much it would cost the average worker
>>to buy the S&P 500 from 1890-1999, is up at
>
>Can you say a little more about what "buy the S&P 500" means? Do you mean
>median share price multiplied by 500 or what?
The S&P 500 is an average based on the prices of 500 blue-chip stocks. It's meant to represent the broad performance of the market over time. It could be reconceived as a single representative share of stock (and it can be traded that way in several forms - futures, index mutual funds, and a synthetic stock - SPDRs - that trade on the Amex). So how long would it take the average worker to buy that representative share of stock? To answer that, you divide the S&P by the average wage and come up with a number of hours.
Doug