I’ve posted Entry #32 to my weekly Valuation-Informed Indexing column at the Value Walk site. It’s called Stock Prices Should Go Up by 6.5 Percent Per Year.
Juicy Excerpt: Good economic times do not increase the productivity of the U.S. economy indefinitely. Productivity has remained sufficiently strong to support an average stock return of 6.5 percent real for as far back as we have records. Each time there were a number of especially good years they were followed by a number of especially bad years. There is no reason to believe that good economic times will in a permanent way increase the value of the ownership share beyond what it has always been in the past.