Unexpectedly Intriguing!
14 December 2007

The Bureau of Labor Statistics just released the latest Consumer Price Index data for November 2007 just minutes ago, and we here at Political Calculations are on top of it! We've already updated our signature tool, The S&P 500 at Your Fingertips, with the stock market's data through the previous month, and the table below shows the index' performance for the year-to-date, year-over-year and since January 1871:

S&P 500 Selected Performance Data
Annualized Rates Nominal Rate of Return (%) Rate of Inflation (%) Real Rate of Return (%)
Since January 1871 9.15 2.09 7.06
Year over Year 7.27 4.28 2.99
Year to Date 5.17 4.58 0.59

Today's S&P 500 Chart

Building on our earlier work for benchmarking the performance of the S&P 500 in terms of the remarkable relationship between the index' value and dividends per share, we've plotted the S&P 500 index value at market open on December 14, 2007 (1488.41) against where S&P anticipates the trailing one-year dividends per share will come in for December 2007 (27.85):

S&P 500 Average Monthly Index Value vs One-Year Trailing Dividends per Share, June 2003 to November 2007, with Current Values for December 14, 2007

The chart demonstrates that for all the volatility we've seen given the liquidity issues in the financial sector related to the fallout in the sub-prime mortgage portions of these companies' portfolios, the basic order that emerged in the post-Dot-Com Bubble stock market continues to be robust. As such, the current value of the market is well within the range of where we should expect it to be in the absence of a disruptive event.

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About Political Calculations

Welcome to the blogosphere's toolchest! Here, unlike other blogs dedicated to analyzing current events, we create easy-to-use, simple tools to do the math related to them so you can get in on the action too! If you would like to learn more about these tools, or if you would like to contribute ideas to develop for this blog, please e-mail us at:

ironman at politicalcalculations.com

Thanks in advance!

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