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Saturday, April 22, 2006

DJIA - inflation adjusted

Talk about not being compensated for market risk! Check out this chart (the one further down in the article). It compares inflation vs inflation-adjusted return on the DJIA since 1924. Note that for the most part the inflation-adjusted gains of the market merely keep even with inflation-induced losses. Ugly. Only since 1995 has there been an (anomalous) overperformance of the DJIA with respect to inflation.

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