RE: Some Econ Pessimism?

Crosby_M (
Thu, 13 Feb 1997 16:18:39 -0500

Why should we be pessimistic about these results?

Yes, the United States has been the exception - it has more closely
approximated a free-market system than any other nation. But as more
nations shed the shackles of socialism and mercantilism, as seems to
be the trend, shouldn't they too begin to approach the capital
appreciation rates experienced in the U.S.?

I would think the real question would be: as more nations achieve
freer market mechanisms is the more level playing field and greater
global competition going to drag everyone down or up?

Mark Crosby
Sent: Thursday, February 13, 1997 3:38 PM
Subject: Some Econ Pessimism?

"A Century of Global Stock Markets"

Yale School of Management
University of California, Irvine

Date: December 1996
By putting together a variety of
sources, we collected a database of capital appreciation
indexes for 39 markets with histories going as far back as
the 1920s. Our results are striking. We find that the United
States has by far the highest uninterrupted real rate of
appreciation of all countries, at about 5 percent annually.
For other countries, the median real appreciation rate is
about 1.5 percent. The high return premium obtained for U.S.
equities therefore appears to be the exception rather than
the rule. <SNIP>