“The issue is never how much longer equities go up — nor how much — than they go down. Indeed, once the investor can be brought into genuine emotional contact with the long-term miracle that is mainstream American equities, the less he/she may actually care about that issue at all.”
– Nick Murray
Last month, we gathered with some valued clients for a live discussion of our investing philosophy. This month, we conduct our annual review of the equity market over the last 62 years.
Save the Date for April 25
We have been publishing our “Great Investors” article series for over 10 years now, and it has consistently been our most popular content every year. We thank our loyal readers, and we truly appreciate your comments and feedback over the years.
As you know, we have changed the format for “Great Investors” from a monthly written commentary to a quarterly webinar. Each quarter, we will deliver a brief talk, summarizing our outlook on current events, delivered in the same style you have come to appreciate in our monthly article series. Following the talk will be ample time for a Q&A and discussion, in order to address any additional questions you may have.
Our next webinar will be held on Thursday, April 25th, and will be available via online live stream, and in person for those who can attend. Please save the date, and more details will be available soon!
Great Investors Review the Last 62 Years
Sixty-Two Years of Growth
Although age 65 has long been assumed to be the retirement age in America, the law says that Social Security benefits are available starting at age 62. This also happens to be the average year that folks retire in our great nation. So, every year we consider the performance of the American equity market in the lifetime of a person reaching this milestone age.
If you are turning 62 this year, you were born in the ironically symmetrical year of 1962. This was the year in which the Beatles auditioned for Decca Records and were rejected, John Glenn became the first American to orbit the earth, Marilyn Monroe died, the New York Yankees won the World Series for the twentieth time, and — during the Cuban Missile Crisis — the world came closer to thermonuclear oblivion than at any time before or since.
Investment-wise, here are a few nuggets that may be of interest as you enter retirement this year:
- The S&P 500 closed out 1962 at 63. In 2023, it ended at 4,770.
- The cash dividend paid out during 1962 was $2.15. Last year it was $70.30.
- The Consumer Price Index ended 1962 at 30. In 2023, it closed out at 307.
In round numbers, here is a summary of the growth in these 3 key metrics over this period:
As a newly minted 62-year-old, headed off to enjoy 30 or more years of retirement and facing an ever-increasing cost of living, this information may prove helpful as you allocate your portfolio.
Helping those you care about
Over the last two years, the faith of all long-term investors has been severely tested. As must happen every few years, we were basically required to do just one big thing: reject the idea that “this time it’s different” and hew to the belief that “this too shall pass.” We must not doubt that we’ll get many additional opportunities to practice patience and discipline in the years to come.
Successful investing, while always fundamentally simple, will never be easy. You may have a family member, colleague, or friend who perhaps did not fare as well during the 2022-23 bear market and who you feel might have benefited from the sort of advice you were receiving. Should that be the case, we would certainly appreciate your introducing us to them. We very much enjoy working with you and would welcome the opportunity to offer the same level of planning and service to people whom you care about.
You are more than welcome to bring a friend or family member to our event on April 25th or to share the recording of our discussion that night.