A Tale of Four Decades – 1995 & 2005 – Part 2 of 3

Forty years seem like a long time.

This is the 2nd post of a 3-part series covering the last 40 years.    We have discussed many times in various posts that 40 years is generally the starting duration that needs to be planned for when we meet with a couple in their mid-50’s.  If a married couple is in the mid-50s, then one or both of them are likely going to work for a minimum of approximately 10 more years.  If they do so, they would retire at approximately the age of 65 years which would likely leave one of them with 30 years in retirement which adds to 40 years in total.

In this post we explore the two years covering 1995 & 2005.  We will again discuss the year 1995 and the year 2005 both in terms of global events and performance of the great U.S. companies that make up the S&P 500 index.  The first two decades can be found in this post:  1975 &  1985 Years in Review.

October 4, 1995


World events from 1995  – The Oklahoma City bombing is the greatest domestic terrorist atrocity in American history until the recent events in San Bernardino CA.  O.J. Simpson’s murder trial begins, and ends 10 months later in his unbelievable acquittal.

Israeli Prime Minister Yitzhak Rabin is assassinated. The World’s 1st cloned sheep, Megan and Morag, are created from embryo cells.

Howard Cosell and Mickey Mantle die.  Album of the Year: “Jagged Little Pill” by Alanis Morissette.  E.R. is the top TV show. A postage stamp cost 32 cents.

Global population:  5.7 billion
U.S.  Population:  266 million
U.S. real GDP:   $10.28 trillion

S&P 500 year-end close:  615
S&P Earnings:     $37.70
S&P Dividends:  $14.17

World events from 2005  Hurricane Katrina devastates an American land mass larger than Great Britain.  Saddam Hussein goes on trial for his life.  July 7 becomes London’s 9/11 as coordinated attacks on the bus and subway system claim 52 lives.  Pope John Paul II dies; he will be canonized only nine years later. Johnny Carson dies. Record of the Year: “Here We Go Again” by Ray Charles and Norah Jones.  A postage stamp costs 37 cents.

carson-1Global population: 6.5 billion, but by the turn of the century, the rate of extreme poverty has fallen to one person in three.
U.S.  Population: 296 million
U.S. real GDP:  $
14.37 trillion

S&P 500 year-end close: 1,248
S&P Earnings:     $76.45
S&P Dividends:  $22.38

The S&P 500 index is weighted by market value, and its performance is thought to be representative of the stock market as a whole. This index provides a broad snapshot of the overall U.S. equity market; in fact, over 70% of all U.S. equity is tracked by the S&P 500.  Earnings and Dividends listed above are per share of the S&P 500 index.  GDP (Gross Domestic Production) is a monetary measure of the value of all final goods and services produced in yearly.

We use the cost of a U.S. postage stamp price as a crude representation of the increase in the cost of items that you need to purchase to maintain the same purchasing power through time.

The greatest inventor who’s ever lived according to the number of lifetime patents awarded – Lowell Wood – discusses how we are just at the beginning of technological breakthroughs in many areas that will transform human lives. (LOWELL WOOD POST).  The free enterprise system will be the catalyst on how these inventions benefit all of us as owners of the great companies in the United States and the world.  The owners of these publicly traded companies are those investors who own stock in these companies.

Next week we end this 3-part series with a look at 2015 and the last 40 years collectively.

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The foregoing content reflects the opinions of Crimmins Wealth Management and is subject to change at any time without notice. Content provided herein is for informational purposes only and should not be used or construed as investment advice or a recommendation regarding the purchase or sale of any security. There is no guarantee that the statements, opinions or forecasts provided herein will prove to be correct. Past performance may not be indicative of future results. All investing involves risk, including the potential for loss of principal. There is no guarantee that any investment plan or strategy will be successful.

About Dan Crimmins

Dan Crimmins, co-founder of Crimmins Wealth Management, is a financial coach and fee only financial planner. Have a financial question? ASK DAN


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