Thread by @jpr007

@elonmusk @CathieDWood @wintonARK @ARKInvest U.S. STOCK MARKET vs U.S. GDP

We should always think about what we have seen before . . .

@elonmusk @CathieDWood @wintonARK @ARKInvest Let's take a look at that journey from the depths of the Second World War in a step-by-step fashion

1. The War Years actually drove a strong stock market

** NOTE : U.S. GDP is shown here in nominal dollars that include inflation **

@elonmusk @CathieDWood @wintonARK @ARKInvest 2. And the relative "Peace" of the late 1950s and early 1960s actually lifted the stock market even higher to run above the GDP trend line

@elonmusk @CathieDWood @wintonARK @ARKInvest 3. But then "Value Creation" in the U.S. Stock Market seemed to fall asleep, and other issues preoccupied "America"

- at least as far as the imperfect Dow Jones index of 30 stocks industrial stocks was concerned

@elonmusk @CathieDWood @wintonARK @ARKInvest 4. That all started to change in positive ways in the early 1980s following the economic "Crisis" in the U.S. when interest rates went sky-high and both traditional industries and stock and bond capital markets started to get disrupted and reshaped in many ways

@elonmusk @CathieDWood @wintonARK @ARKInvest 5. And finally by the late 1990s everyone thought we were back in "The Best Of Times"

@elonmusk @CathieDWood @wintonARK @ARKInvest 6. Which turned out to bring its own risks with it

The tech-heavy NASDAQ and the Dow Jones Index had largely been tracking together with each other from around the mid-1980s . . .

@elonmusk @CathieDWood @wintonARK @ARKInvest 7. But in the late 1980s the NASDAQ Index went off on an excursion that quickly collapsed

- with much pain for a set of investors who had come to expect "too much too fast" out of the newly-emerging "digital economy"

@elonmusk @CathieDWood @wintonARK @ARKInvest 8. Now that this important question has once again been asked, it looks like it may be worthwhile to repeat that analysis from 2001 and bring it up to date

- but this time using the S&P 500 as a broader index than the Dow Jones

@elonmusk @CathieDWood @wintonARK @ARKInvest 9. And also to look more closely at the implied valuation of Earnings represented by the aggregated P/E Multiple of the stock market