How Does the ’09 Rally Stack Up Against ’82 Bull Market?

November 18, 2009 11:30am by Barry Ritholtz

This is one of the things I will be discussing at the Berlin Conference:

Comparing the 1982 Bull Market with the 2009 Rally

Rally Comparison	1982	2009
P/E Multiple	8X	26X
Dividend Yields	6%	below 2%
Book Value	Discount to Book	2X Premium
Monetary Policy	Reducing money growth and inflation rates	Creating money growth and inflation rates
Fiscal Policy	Aimed at reducing nondefense spending	Aimed at accelerating nondefense spending
Deficits	Peaking and coming down relative to GDP	Surging to 10%+ relative to GDP
Global Trade Barriers	Were being torn down	Are being erected
Regulation	Deregulation in vogue	Re-regulation rising
US Dollar	Plaza Accord bull market	Mercantilist bear market
Household Credit	Balance sheets and participation rates expanding	Balance sheets now contracting
Tax rates	Income, capital gains and dividend taxes declining	Taxes Rising Now

Sources: Gluskin Sheff, S&P, Bloomberg

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