Funeral director had $250 million stash of IBM stock
portfolio.com
portfolio.com
Heck, my meager Roth IRA savings plus 100 years of 8% compounding would be worth about $25 million, give or take. That is below the actual performance of the American stock market these last 100 years, to boot.
(Granted, most of us can't directly benefit from 100 years of appreciation, but most of us could directly benefit from well more than 40, and if you have kids or causes that will survive you, hey, the sky is the limit.)
If you're into that sort of thing.
This is a common strategy for long-term investors.
EX: While buying 100$ in stock at 10$/share and 100$ in stock at 20$/share means the average price was 15$ you have 15 shares for 200$ which is 13.33$ / share.
1.08^100 = 2200 so 1$ = 2200$
(2200 * .6)^(1/100) = 1.0745, and 1$ = 1320$
PS: A 40% drop might seem like a huge deal but over time it's just not that important. ~8% vs ~7.5%
On a 100-year scale, a 'tiny' 0.5% drop in compound return is massively 'important' in effect. It's no consolation to the person with 40% less money that his annualized performance was only 0.5% worse; you own the $1320, not the 7.45%.
"8%" is often thrown around as a long-long-term guesstimate of stock returns; if in fact that's slipped to 'merely' 7.5% based on the last year, that's remarkable.
The hit against the annualized rate within timeframes more like the earning careers (or even lifespans) of News.YC readers is also big. Here's an interesting graph for S&P total return over the last 20 years:
http://mahalanobis.twoday.net/stories/5279642/
A dollar from 1988 was giving near (or far over) 8% annualized return until mid-2007; now it's more like 5%.
http://www2.standardandpoors.com/spf/pdf/index/112808_Worldb...
IMO picking a peak or valley is less informative than what happens when you invest one inflation adjusted dollar every month over the history of a stock exchange. Add in selling off 1-4% a year and you can see what the stock market does for normal peoples investments.
In a way, looking at the past century and assuming that the next one will be similar in terms of return rates is like expecting Google's stock to grow spectacularly over the next decade. Once you are #1 there is not as much room for explosive growth.
According to Guy Kawasaki, he bought a BMW motorcycle during the development of the original Mac, which he kept parked near near the lobby of the building where Mac development took place. According to Kawasaki, Jobs referred to it as living art.
Supposedly he later kept a BMW motorcycle, (not clear if it was the same one) in the living room of Jackling house, his mansion in Woodside.