Unexpected Returns : Understanding Secular Stock Market Cycles

Figures viii Acknowledgments xii Introduction xiv Section I: Getting Started 1(20) Planning the Journey 2(9) The Right Frame of Mind 4(5) Ten Key Concepts 9(2) The Principles 11(10) Final Preparation 11(10) Section II: Market History 21(52) Stock Market History 23(32) The Stock Market Matrix: Taking the Red Pill 23(9) Making Returns and Assumptions Relevant 32(2) Generational Returns -- Twenty-Year Returns 34(5) Significant Swings 39(2) Why Volatility Matters 41(1) Volatility Gremlins 41(8) Stock Market Yo-Yo 49(3) Must Be Present to Win? 52(3) Interest Rates & the Inflation Roller Coaster 55(18) Money and Power 55(1) Overview of Interest Rates 56(3) Overview of Inflation 59(4) Interest Rates and Inflation 63(3) Dynamic History 66(2) The 6/50 Rule 68(4) Key Concepts for This Section: Market History 72(1) Section III: Secular Cycles 73(40) Secular Cycles 75(20) Seasons of the Stock Market: Secular Cycles 75(5) Stock Market Profile Across Secular Periods 80(4) Inflation, Deflation, and Market Seasons 84(1) Dispelling the Myth: It's Not the Economy 85(1) The Y-Curve Effect 86(4) Valuation Matters 90(5) The Current Cycle 95(18) Current Market Cycle 96(9) The Dividend Insight 105(1) Looking Ahead 106(6) Key Concepts for This Section: Secular Cycles 112(1) Section IV: Financial Physics 113(64) Financial Physics 114(31) Predicting the Future of the Stock Market 114(3) Building the Financial Physics Model 117(20) Financial Physics: Valuation and Prediction 137(8) Implications from Financial Physics 145(32) The Voyage So Far 145(2) What's Next 147(2) Valuation Cascade: Natural Upper Limit for P/Es 149(15) Dissecting Returns: Forecasting Stock Market Returns 164(9) Limited Returns and Market Vulnerability 173(3) Key Concepts for This Section: Financial Physics 176(1) Section V: Investment Philosophy 177(42) Investment Philosophy 178(26) Contrasting Absolute Return and Relative Return 179(6) Risk Can Be a Friend or a Foe 185(12) Return Profiles 197(2) A Little History: The Devil's in the Assumptions 199(2) The Popularity Contest 201(3) Row, Not Sail 204(15) Sailing and Rowing 205(10) Drowning in Averages 215(1) Key Concepts for This Section: Investment Philosophy 216(3) Section VI: Investment Strategy 219(41) Techniques for Traditional Investors 220(18) Effective Bond Portfolios 221(11) Rebalancing Stock Market Portfolios 232(6) Investment Management Evolution 238(22) A Brief History 238(7) Hedge Fund Investing 245(10) Vision of Future Investment Management 255(2) Closing the Loop 257(1) Ten Key Concepts 258(1) Fork in the Road 259(1) Notes 260(1) Data Sources and Methodologies 260(10) Additional Concepts 264(6) Bibliography 270(3) Index 273