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Posted on 3 April 2011 | 7,349 views

Inflation Adjusted Bear Market on Stock Indexes

To get a long term perspective on how the S&P 500 Index has been performing since the year 2000, the inflation-adjusted chart below shows exactly where we are today compared to the Dow Jones Industrial Average Index bear market which started after the 1929 stock market crash along with the Nikkei 225 Index bear market which started in 1989.

Looking at the S&P 500 Index close on April 1, 2011, we see that it closed at 1,332.41 but when you adjust it for inflation since January of 2000, it should be at 1,898.48 — down 566.07 points.

Because market technicians and economists believe we are in a “Secular Bear Market” which should last until the year 2020 or forecasters which see a “Major Stock Market Crash Coming for Stocks by September 2011“, the chart shows it’s possible we could still fall another 38% (721.42 points) inflation adjusted on the S&P 500 Index, bringing it to 610.99 — a level we have not seen since if it follows past secular bear markets since December 21, 1995.

Inflation Adjusted Bear Market on Stock Indexes



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