Chart of the Day: Getting Rich in the Stock Market

For indispensable reporting on the coronavirus crisis, the election, and more, subscribe to the Mother Jones Daily newsletter.

CJR’s Ryan Chittum points us to the chart below, which compares S&P 500 stock market returns over the past 50 years (blue bars) to those same returns after accounting for trading and management costs, dividend and capital-gains taxes, and inflation (red bars). It’s part of a Bloomberg piece by David Wilson summarizing a report prepared by David Bianco, chief U.S. equity strategist at Bank of America Merrill Lynch. Once you take into account all the adjustments, the annual average return of the S&P 500 goes from 9.5% to 1.3%. Chittum comments:

Just remember when those financial advisers tell you to expect 8 percent to 10 percent annual returns that in real money over the last 50 years, you took home a measly 1.3 percent. As I wrote in January: “You have to wonder if there’s a connection to be drawn between the low savings rate and the idea that took hold in the last three decades, which still hasn’t been extinguished even after this miserable decade, that investing in stocks means you’ll get big returns on your money.”

Of course, your basic money market account is returning about 0% these days, give or take a few mils, so it’s not as if we little guys have a ton of other great investment opportunities. Luckily, the Wall Street tycoon set is still doing well. It’s not all bad news out there, my friends.

SIX TRUTHS

Reclaiming power from those who abuse it often starts with telling the truth. And in "This Is How Authoritarians Get Defeated," MoJo's Monika Bauerlein unpacks six truths to remember during the homestretch of an election where democracy, truth, and decency are on the line.

Truth #1: The chaos is the point.

Truth #2: Team Reality is bigger than it seems.

Truth #3: Facebook owns this.

Truth #4: When we go to work, we're in the fight.

Truth #5: It's about minority rule.

Truth #6: The only thing that can save us is…us.

Please take a moment to see how all these truths add up, because what happens in the weeks and months ahead will reverberate for at least a generation and we better be prepared.

And if you think journalism like Mother Jones'—that calls it like it is, that will never acquiesce to power, that looks where others don't—can help guide us through this historic, high-stakes moment, and you're able to right now, please help us reach our $350,000 goal by October 31 with a donation today. It's all hands on deck for democracy.

payment methods

SIX TRUTHS

Reclaiming power from those who abuse it often starts with telling the truth. And in "This Is How Authoritarians Get Defeated," MoJo's Monika Bauerlein unpacks six truths to remember during the homestretch of an election where democracy, truth, and decency are on the line.

Truth #1: The chaos is the point.

Truth #2: Team Reality is bigger than it seems.

Truth #3: Facebook owns this.

Truth #4: When we go to work, we're in the fight.

Truth #5: It's about minority rule.

Truth #6: The only thing that can save us is…us.

Please take a moment to see how all these truths add up, because what happens in the weeks and months ahead will reverberate for at least a generation and we better be prepared.

And if you think journalism like Mother Jones'—that calls it like it is, that will never acquiesce to power, that looks where others don't—can help guide us through this historic, high-stakes moment, and you're able to right now, please help us reach our $350,000 goal by October 31 with a donation today. It's all hands on deck for democracy.

payment methods

We Recommend

Latest

Sign up for our free newsletter

Subscribe to the Mother Jones Daily to have our top stories delivered directly to your inbox.

Get our award-winning magazine

Save big on a full year of investigations, ideas, and insights.

Subscribe

Support our journalism

Help Mother Jones' reporters dig deep with a tax-deductible donation.

Donate