By the Numbers

1. THE OLDEST INDEX - The Dow Jones Industrial Average turned 111-years old last Saturday (5/26/07). Only 12 stocks were used in the index’s original calculation during May 1896 and only 1 stock in that group remains in the index today. The index was expanded to 30 stocks in October 1928, just 1-year before the 1929 stock market crash. The Dow Jones Industrial Average is an unmanaged index of only 30 stocks and is not generally considered representative of the broad US stock market (source: Dow Jones).

2.BOUNCE BACK - In 8 of 9 bear markets producing at least a 20% decline in the S&P 500 in the last half century (1957-2007), the stock market eventually recovered 100% of the loss sustained, i.e., going above the previous bull market high. The recovery from the 9th bear market, a 49% tumble that ended on 10/09/02, was nearly completed last week but it ended on Monday just 2 points short. The S&P 500 is an unmanaged index of 500 widely held stocks that is generally considered representative of the US stock market (source: BTN Research).

3. IMPATIENT - The average length of time that an American investor held an individual stock before 1970 was greater than 5 years. The average length of time that an investor holds an individual stock today is less than 10 months (source: BusinessWeek).

4. DOMESTIC FROTH - Over the 2 years leading up to its all-time closing high of 5049 set on 3/10/00, the NASDAQ Composite nearly tripled in value, gaining +189%. The NASDAQ Composite is an unmanaged index of securities traded on the NASDAQ system (source: BTN Research).

5. FOREIGN FROTH - The Chinese Shanghai stock index has nearly quadrupled in value over the last 2 years. From its closing price of 1072 on 5/25/05 to its close of 4180 last Friday, the foreign stock index has gained +290%. The Shanghai index is an unmanaged index that is generally considered representative of the Chinese stock market. These international securities involve additional risks including currency fluctuations, differing financial accounting standards and possible political and economic volatility (source: BTN Research).

6. ON THE BANDWAGON - Chinese citizens opened +160,000 new investment accounts each day last month (i.e., 4.8 million new accounts for the month) in an effort to participate in their rising stock market (source: USA Today).

7. ALMOST - The S&P 500 came within 2 points of an all-time closing high last Monday. From last Friday’s close, the NASDAQ would have to gain +12% annually for 6 years to set an all-time closing high (source: BTN Research).

8. US vs. THEM - The Chinese Shanghai stock index is trading at a 43 price-earnings ratio today. At the peak of the tech stock bubble in March 2000, the 100 largest capitalized stocks in the NASDAQ Composite were trading at a 172 price-earnings ratio. A company’s price-to-earnings ratio is equal to a company’s stock price divided by its earnings per share and when compared over time may provide some insight into undervalued and overvalued stocks (source: USA Today, Wall Street Journal and NASDAQ).

9. COMPARE THE INDEXES - Both the S&P 500 and the NASDAQ Composite are cap-weighted indexes, i.e., the larger the individual stock, the greater is its weight in the index’s calculation. Overall the S&P 500 is nearly 4 times as large (in terms of market capitalization) as the NASDAQ, even though the S&P 500 has less than one-sixth as many stocks (source: NASDAQ, Wilshire).

10. ONLY RATIONAL DECISIONS HERE - 65% of American investors do not believe their emotions impact the investment decisions they make (source: Prudential).

11. OLD AGE - 30% of American workers believe they are “very likely” or “somewhat likely” to live to age 95 (source: Employee Benefit Research Institute).

12. STILL MAKING PAYMENTS - 64% of homeowners between the ages of 55-64 still have mortgage debt on their primary residence (source: Center for Retirement Research, Federal Reserve).

13. MORE THAN HALF - 56% of Americans are either “very worried” or “moderately worried” about whether they have saved enough money for retirement, down from 60% last year (source: Gallup).

14. FED BOARD - President Bush intends to nominate Elizabeth Duke and Larry Klane (replacing the retired Mark Olson and Susan Bies) to the Fed’s 7-person Board of Governors (source: White House).

15. HAIL TO THE CHIEF - The next President of the United States (# 44) will take office on 1/20/09 or 600 days from this Thursday (5/31/07). George Bush will occupy the White House for 2,922 days during his 8 years as our nation’s 43rd President (source: BTN Research).