Last night, Dave Ramsey hosted the Town Hall for Hope. It was a great event in which he provided context around what happened to the economy, historical perspective, quotes, scripture, and straight talk. The media can tend to hype things and get everyone down and out thinking the world is coming to an end.
Here are some statistics that Dave shared during the Town Hall for Hope. When people starting talking about how terrible things are, they are good to keep in mind. These are re-posted from http://www.townhallforhope.com/index.cfm?event=displayPostStats".
* From 1833 to 2001, the compound annual growth rate was 1.54%.
* From 2001 to now, we’ve seen a compound annual growth rate of 15.57%.
* But even with the surge, the lifetime annual growth of gold is only 2.14%.
* 50% of United States foreclosures in 2008 came from 35 counties in 12 states.
* 20% of the United States’ population lives in these 35 counties.
* Eight counties in Arizona, California, Florida and Nevada were the source of 25% of foreclosures.
* Existing home sales rose to a seasonally adjusted annual rate of 4.7 million units in February, 2009, and only 860,000 homes were repossessed all of 2008.
The Stock Market:
* Investors have made money 100% of the 15-year periods in the stock market’s history.
* Since 1974, the value of the S&P 500 has grown 1,250%, from 63 to 850.
The Great Depression and Recent Recessions:
* 1938–40: Unemployment grew to over 17%, the Stock Market dropped 89%, and bread lines were real; executives didn’t fly Gulfstreams to Washington, D.C. looking for bailouts.
* 1974: The Stock Market dropped 50%, gas lines snaked around the block, and inflation became stagflation, i.e. inflation in a stagnant economy.
* 1982: Inflation was over 10%, unemployment was over 10%, and the interest rate reached 17% on home mortgages.
* 2009: Unemployment is at 8.5%, there is no inflation, and the home mortgage rate is 4 3/8%. The Stock Market dropped 57%, but it has recently risen from a low of 6400 to over 8000.
Recovery from the Great Depression:
* Those who did nothing recovered in 4 years, 4 months.
* Those who sold out at the bottom realized a 78% loss.
Stock Market Performance Following Recessions:
* 1945–2007: The average bear market lasted 12.7 months with an average decline of 30.3%.