The past 25 years have been the best stock market for investors in U.S. history. The Dow Jones industrial average hit bottom on Aug. 12, 1982, at 776.9, while interest rates were at 15 percent. Since that date, the compounded rate of return from the last quarter of 1982 until this summer, circa 2007, has been 11.8 percent. Taking into account inflation, the rate of return has been 8.5 percent!!!
Thiswas the result of policy decisions in the 1980s, 90s and more recently - confirming the fact that lower tax rates on capital and labor, sound monetary policies, with open market initiatives and liberalized trade leads to stronger economic growth and rising values in equities.
When Ronald Reagan took office the top tax rate was 70 percent and the capital gains rate was near 50 percent. The soft money policies of the Carter administration had left us with rising unemployment and inflation rate of 16 percent(i.e. stagflation.) (Carter is the worst Prez Ever!)
2007-08-16
14:21:42
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thealligator414
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Politics