Trying to figure out this DJIA thing!?!? - Mercedes-Benz Forum

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post #1 of 47 (permalink) Old 09-16-2008, 08:23 PM
Haddixracing
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Trying to figure out this DJIA thing!?!?

I went here: .DJI - DOW JONES INDUSTRIAL AVERAGE INDEX - Google Finance

Then I set the graph to maximum. It went back to 1970. Why is the graph so flat until 1981? Then from 1981 it grows steady till late 1993 when it grows almost exponentially. It then gets flat in 1999 and begins declining around April 2001. From 2003 on it has a pretty stead increase with a high point around Oct of 07.

Couple questions. First why is the line so flat from 1970 until the Reaganomics era? Did the presidents during those 11 years do nothing and the world market had zero innovation?

Why does it increase SOOOO fast during Clinton's terms? Was that the internet and housing market booming? Holy cow!

Why are people talking about horrible economy when the DJIA is so far up in the stratosphere still compared to 1970s, 80s, and 90s?

In 1970 it was around 750, 1980 around 850, 1990 around 2500, 1996 around 5500. Today it is around 11,000!

I don't understand the concern. Someone please educate me. I don't get it.
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post #2 of 47 (permalink) Old 09-16-2008, 08:26 PM
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You need to sign up for an intro to economics at your local community college, it will do you good and you might learn a bit of history.
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post #3 of 47 (permalink) Old 09-16-2008, 08:27 PM
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The concerns are periodic and tethered to events not the long term if you're looking at it from a long term investor point of view. It's the day to day shit that worries most people but in the end I hope that you learned that investing is actually a good idea to at least hedge against inflation. Run an inflation chart with that would ya
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post #4 of 47 (permalink) Old 09-16-2008, 08:28 PM
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Originally Posted by drewprof View Post
You need to sign up for an intro to economics at your local community college, it will do you good and you might learn a bit of history.
I took 6 economics classes at Wright State about 7 years ago.
I received B's or better in all of them too. I still have no clue what the deal is with the DJIA. It seems to represent nothing.
post #5 of 47 (permalink) Old 09-16-2008, 08:29 PM
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The concerns are periodic and tethered to events not the long term if you're looking at it from a long term investor point of view

I am looking at it from a "I will never invest money in it but I need to know how it will affect my daily budget in the future pov."
post #6 of 47 (permalink) Old 09-16-2008, 08:30 PM
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Originally Posted by Haddixracing View Post
I took 6 economics classes at Wright State about 7 years ago.
I received B's or better in all of them too. I still have no clue what the deal is with the DJIA. It seems to represent nothing.
It's actually not a real good index based on what's going on right now. Try the S&P500
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post #7 of 47 (permalink) Old 09-16-2008, 08:32 PM
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Haddi, you are wiser than you think. The stock market is going to shit because it's time for this country to get off it's ass and roll up their sleeves and get to work. And quit trying to make a living off others backs.
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post #8 of 47 (permalink) Old 09-16-2008, 08:34 PM
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Originally Posted by Haddixracing View Post
I am looking at it from a "I will never invest money in it but I need to know how it will affect my daily budget in the future pov."
Where do you intend to invest your money? Real estate, business, stuff? They all require inventory, maintenance and personal attention. Stocks on the other hand are like cash, you don't have to wait an eternity for everyone to dissolve your company, or for a settlement to go through on a piece of property; you just pay a small fee and your money is in your hand.
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post #9 of 47 (permalink) Old 09-16-2008, 08:35 PM
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Quote:
Originally Posted by Haddixracing View Post
I took 6 economics classes at Wright State about 7 years ago.
I received B's or better in all of them too. I still have no clue what the deal is with the DJIA. It seems to represent nothing.
SIX, did you say 6? Did you repeat the same course or was your major economics?
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post #10 of 47 (permalink) Old 09-16-2008, 08:44 PM
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For someone in TWO internet startups, you seem awfully free.
Remember drew is a worker of the night so you can't keep up with him.

Quote:
Originally Posted by Haddixracing View Post
I went here: .DJI - DOW JONES INDUSTRIAL AVERAGE INDEX - Google Finance

Then I set the graph to maximum. It went back to 1970. Why is the graph so flat until 1981? Then from 1981 it grows steady till late 1993 when it grows almost exponentially. It then gets flat in 1999 and begins declining around April 2001. From 2003 on it has a pretty stead increase with a high point around Oct of 07.

Couple questions. First why is the line so flat from 1970 until the Reaganomics era? Did the presidents during those 11 years do nothing and the world market had zero innovation?

Why does it increase SOOOO fast during Clinton's terms? Was that the internet and housing market booming? Holy cow!

Why are people talking about horrible economy when the DJIA is so far up in the stratosphere still compared to 1970s, 80s, and 90s?

In 1970 it was around 750, 1980 around 850, 1990 around 2500, 1996 around 5500. Today it is around 11,000!

I don't understand the concern. Someone please educate me. I don't get it.
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